Intellectual Property and Information Control: Philosophic Foundations and Contemporary Issues

Intellectual Property and Information Control

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Intellectual Property and Information Control Philosophic Foundations and Contemporary Issues

Adam D. Moore

Transaction Publishers New Brunswick (U.S.A.) and London (U.K.)

Copyright © 2001 by Transaction Publishers, New Brunswick, New Jersey 08903. All rights reserved under International and Pan-American Copyright Conventions. No part of this book may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording, or any information storage and retrieval system, without prior permission in writing from the publisher. All inquiries should be addressed to Transaction Publishers, Rutgers—The State University, New Brunswick, New Jersey 08903. This book is printed on acid-free paper that meets the American National Standard for Permanence of Paper for Printed Library Materials. Library of Congress Number: 2001027885 ISBN: 0-7658-0070-5 Printed in the United States of America Library of Congress Cataloging-in-Publication Data Moore, Adam D. Intellectual property and information control : philosophic foundations and contemporary issues / Adam D. Moore. p. cm. Includes bibliographical references and index. ISBN 0-7658-0070-5 (alk. paper) 1. Intellectual property—United States. 2. Computer systems—Law and legislation—United States. 3. Data transmission systems—Law and legislation—United States I. Title. KF2979 .M66 2001 346.7304'8—dc21

2001027885

Dedicated to Kimberly, Alan, and Nancy

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Contents List of Tables

ix

Preface

xi

Acknowledgments

xiii

1.

Introduction and Overview

1

2.

The Domain of Intellectual Property

9

3.

Against Rule-Utilitarian Intellectual Property

37

4.

A Pareto-Based Proviso on Original Acquisition

71

5.

Toward a Lockean Theory of Intellectual Property

103

6.

Justifying Acts, Systems, and Institutions

121

7.

A New Look at Copyrights, Patents, and Trade Secrets

147

8.

Intangible Property: Privacy, Power, and Information Control

181

9.

Employee Monitoring, Nondisclosure Agreements, and Intangible Property

195

10. Owning Genetic Information and Gene Enhancement Techniques

211

11. Information Control and Public Policy: The Encryption Debate

223

Bibliography

237

Index

249

List of Tables Table 1.1

Worldwide Software Piracy Table

2.1

Systems of Property

2.2

Simplified Relationships Between Patents, Copyrights, Trademarks, and Trade Secrets

4.1

The Baseline Table

4.2

Opportunities Table

5.1

Rivalry of Goods

6.1

Pareto Superiority and Private Property Relations

6.2

Levels of Justification

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Preface This work contains numerous arguments, sketches, views, and theories and not all are central to the main thesis. I have tried to make the model of intellectual and intangible property presented in these pages accessible while maintaining a fair amount of rigor and depth. I thus skirt the line of boring the expert and overwhelming the novice. My hope is that I have done neither. After gaining the overview offered in chapter 1, the reader who wishes to move rapidly may want to skim or omit certain sections or chapters. Chapters 3-6 are the argumentative core of the book while chapters 7-11 contain applications of the theory. Sections of chapters are appropriately titled so that the reader can quickly surmise if skimming or omission would be appropriate. For example, experts in moral theory may want to skip the second section of chapter 3 entitled A General Overview of Utilitarian Theory while those well versed in intellectual property law (copyrights and patents) may want to omit the first few sections of chapter 2. The claim that “there is room for words on subjects other than last words” is certainly true of this work. I do not pretend to offer a complete theory that is unassailable and neatly packaged — the moral, legal, and political issues discussed herein are resistant to easy answers. What you will find is an intuitive model of intangible property that is both clearly presented and well reasoned. The tensions between intellectual property, information access, privacy, free speech, and accountability have been highlighted with the coming of the networked world. My hope is that this work will add to what has become a lively area of philosophical debate. A.D.M.

xi

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Acknowledgments I would like to thank Don Hubin (Ohio State University) and Peter King (Ohio State University) for reading and commenting on the first draft of the manuscript. Their comments and criticisms have profoundly influenced this work. Thanks to David T. Wasserman (University of Maryland, College Park), Ken Itkowitz (Marietta College), Jim Swindler (Wittenberg University), Earl Spurgin (John Carol University), Avery Kolers (University of Arizona), Richard Garner (Ohio State University), Nancy Snow (Marquette University), Dan Farrell (Ohio State University), and John Moser (Institute for Humane Studies) for commenting on specific chapters or sections. Chapters 3, 4, 5, 8, 9, and 10 benefited significantly from being presented at various conferences and colloquia series including: Pacific Division Meeting of the American Philosophical Association (April 2000); 27th Conference on Value Inquiry (April 1999); MidSouth Philosophy Conference (March 1999); Ohio Philosophical Association Conference (April 1998); Central Division Meeting of the American Philosophical Association (1997); and the Mountain Plains Philosophy Conference (1997). My gratitude to those conference participants who provided helpful comments and suggestions. Parts of chapters 1, 4, and 6 appear in “Introduction to Intellectual Property” and “Toward a Lockean Theory of Intellectual Property” in my edited anthology, Intellectual Property: Moral, Legal, and International Dilemmas (Rowman and Littlefield, 1997). Earlier versions of sections of chapters 4 and 7 appear in “A Lockean Theory of Intellectual Property” found in the Hamline Law Review 21 (Fall 1997). Chapter 8 draws directly from material that originally appeared in “Intangible Property: Privacy, Power, and Information Control,” American Philosophical Quarterly 35 (October 1998). Material from an earlier version of chapter 9 was published in Business Ethics Quarterly 10 (July 2000) entitled “Employee Monitoring and Computer Technology: Evaluative Surveillance v. xiii

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Privacy.” Chapter 10 contains material published in Bioethics 14 (Spring 2000) entitled “Owning Genetic Information and Gene Enhancement Techniques.” Chapter 11 draws from an article, “Privacy and the Encryption Debate,” in Knowledge, Technology, and Policy 12 (Winter 2000). I thank editors of these publishers for allowing me to present this material here. A special thanks to my friends and loved ones who have supported me throughout the writing process—Scott Rothwell, Mark VanHook, Walter James, Bill Kline, Nick Morse, James Summerford, Nancy Moore, Alan Moore, and Kimberly Moore. I also would like to thank Nancy Moore for reading, editing, and commenting on an early draft and the Institute for Humane Studies (George Mason University, Fairfax, VA) for a summer fellowship (1997) that provided much needed support during the initial writing stages.

1 Introduction and Overview “I would like to leave you with the impression that if you make a single illegal copy of our software, you will spend the next five years in court, the following ten in prison, and forever after your soul will suffer eternal damnation.” —V. Rosenburgh, “Copyright and the New Technology”1

Introduction Access to ideas, and to the physical embodiments of ideas, fundamentally shapes our opportunities, goals, and lifelong projects. The explosion of computer technology and the proliferation of digital networks has radically altered the way that ideas and information are gathered and manipulated. New models of information access and control promise profound changes for each of us—as life-altering as the changes that flowed from the introduction of Gutenberg’s press, Darwin’s theory of evolution, or Pasteur’s germ theory of disease. In modern times the debate over the control and ownership of digital information and intellectual property has been waged by two factions. Standing in the way of the cyber-punks, hackers, and net surfers who claim that “information wants to be free” and that intellectual property rights give undue credit to authors and inventors, are the collected cannons of Anglo-American copyright, patent, and trade secret law. Defenders of these institutions typically argue that granting rights to authors and inventors is necessary for the optimal production of intellectual works and the corresponding gains in social utility. Information, like any other commodity, can be bought and sold on the open market. Following Nathaniel Shaler many defenders of intellectual property argue that “there is no property more peculiarly a Man’s own than that which is produced by the Labour of his mind”2 or “[I]t will be clearly seen that intellectual property 1

2

Intellectual Property and Information Control

is, after all, the only absolute possession in the world. . . The man who brings out of nothingness some child of his thought has rights therein which cannot belong to any other sort of property.”3 Conversely, opponents argue that intellectual property rights give undue credit to authors and inventors and serve to restrict the free flow of information that would otherwise benefit everyone. Another reason why many individuals find it difficult to recognize intellectual property rights is that they see ideas as part of one’s common culture. Ideas are not to be corralled or hoarded up—they are the common currency of thought, speech, and language. 4 Thomas Jefferson wrote: If nature has made any one thing less susceptible than all others of exclusive property, it is the action of the thinking power called an idea, which an individual may exclusively possess as long as he keeps it to himself; but the moment it is divulged, it forces itself into the possession of everyone, and the receiver cannot dispossess himself of it. Its peculiar character, too, is that no one possesses the less, because every other possesses the whole of it. He who receives an idea from me, receives instruction himself without lessening mine; as he who lights his taper at mine, receives light without darkening me. That ideas should freely spread from one to another over the globe, for the moral and mutual instruction of man, and improvement of his condition, seems to have been peculiarly and benevolently designed by nature, when she made them, like fire, expansible over all space, without lessening their density at any point, and like the air in which we breathe, move, and have our physical being, incapable of confinement or exclusive appropriation. Inventions then cannot, in nature, be a subject of property.5

Jefferson was impressed with the non-rivalrous nature of intellectual property—intellectual works can be used and consumed by many individuals concurrently. He was certainly opposed to granting intellectual property rights to ideas already in the public domain. While Jefferson’s metaphor of passing light or fire along to others is a strong one, I wonder if he would defend this view if the creator of the light had labored ten years to produce it. In subsequent chapters I will argue that the non-rivalrous nature of intellectual works leads in a different direction—toward intellectual property rights. Modern day disciples of Shaler and Jefferson push further and argue in a similar fashion as exhibited by the quote that begins this chapter and the following view expressed in the Bellagio Declaration: In general, systems built around the author paradigm tend to obscure or undervalue the importance of “the public domain,” the intellectual and cultural commons from which future works will be constructed . . . [w]e declare that in an era where information is among the most precious of all resources, intellectual property rights cannot be framed

Introduction and Overview

3

by the few to be applied to the many . . . We must reimagine the international regime of intellectual property.6

Moreover, international treaties like Trade Related Aspects of Intellectual Property, known as TRIPS, seek to pattern the global information infrastructure after Anglo-American copyright law. Defenders of rights to intellectual property find this agreement promising in that the rights of authors and inventors can be protected internationally. Many hackers, cyber-punks, programmers, net surfers, and others, support “idea anarchy” and argue for complete access to all kinds of information. This latter view is echoed by the policies of many developing countries who hold that intellectual works are social, not individual, products. It is claimed that the result of these latter attitudes about intellectual property has led to an explosion of copyright violations and international piracy. Consider the following table which focuses on international computer software piracy.

Table 1.1 Worldwide Software Piracy Table Country

Australia Denmark France Germany Italy Japan Korea Singapore Spain Sweden Taiwan Thailand UK United States

% falling to piracy, 1992/1999 45/32 48/29 73/39 62/27 86/44 92/31 82/50 41/51 86/53 60/35 93/54 99/81 54/26 35/25

Source: Business Software Alliance, 1992/1999

US $ losses (million), 1992/1999 160/150 67/59 1200/548 1000/652 550/421 3000/975 648/197 24/61 362/247 171/131 585/122 181/82 685/679 1900/3191

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“. . . a 36 percent global piracy rate (1999) is still substantial. Currently more than one out of every three software applications installed in the world is pirated. This translates into $12 billion lost due to software piracy. In the U.S. alone, software piracy cost 109,000 jobs . . . “7 While this overstates the case because it is assumed that those who obtain goods from software pirates would have purchased legal copies, these numbers in the area of software ownership are alarming to those who would defend institutions of intellectual property. 8 Things may be even worse for the recording industry where music swap sites like Napster make piracy easy and cost free. “Napster allows you to search for almost any song . . . finds the song on a fellow enthusiast’s hard drive and then permits you to get the song for yourself, right now.”9 You can then burn your own CD, download the song to an MP3 player, or simply cue it up on your own computer. Millions of college students and music junkies have been flocking to Napster or similar sites and amassing huge music libraries—for free. One artist manager claimed, “Basically they’re saying our art is worthless . . . music used to be collectable now it is disposable.”10 Lars Ulrich, the drummer for Metallica, put the point the following way. “This is an argument about intellectual property . . . where does it end? Should journalists work for free? Should lawyers? Engineers? Plumbers?”11 Even so, many argue that the information age has passed by the old, and now outdated, copyright paradigm. Where institutions of copyright may have worked well for the written page they cannot be retrofitted to accommodate the bit streams of digitized intellectual works. John Perry Barlow, a writer for Wired Magazine, echoes this view: This vessel, the accumulated canon of copyright and patent law, was developed to convey forms and methods of expression entirely different from the vaporous cargo it is now being asked to carry. It is leaking as much from within as from without . . . Legal efforts to keep the old boat floating are taking three forms: a frenzy of deck chair rearrangement, stern warnings to the passengers that if she goes down, they will face harsh criminal penalties, and serene, glassy-eyed denial . . . Intellectual property law cannot be patched, retrofitted, or expanded to contain digitized expression any more than real estate law might be revised to cover the allocation of broadcasting spectrum (which, in fact, rather resembles what is being attempted here). We will need to develop an entirely new set of methods as befits this entirely new set of circumstances.12

The problem generated by the digitization of intellectual property for copyright and patent is that these institutions protect durable

Introduction and Overview

5

physical expressions, but digital property is hardly physical or durable in the same way as books, movies, or processes of manufacture. Intellectual property law has always sought to separate the idea from its physical expression, granting ownership rights to the latter but not to the former: “the rights of invention and authorship adhered to activities in the physical world. One didn’t get paid for ideas, but for the ability to deliver them into reality.”13 Many within the Anglo-American tradition claim that ideas are public property while physical embodiments of ideas may be privately owned. A major problem for an online age is that there may be no way to separate idea from expression. If so, modern Anglo-American institutions of intellectual property will have to be reworked, or maybe even abandoned altogether. Complicating things still further are the issues that surround individual privacy, public accountability, free speech, and information control. There is an obvious tension between privacy and free speech. While thought, expression, and a free press are recognizably beneficial they are not always so—not when what is expressed unjustifiably invades private domains. The balance struck in the last century between privacy and free speech is being overturned by digital networking and information trading. For example, with the right kind of computer savvy, I can now go online and find out intimate personal details about almost anyone and offer it all up for public consumption. Moreover, if I am sly enough I may be able to do this anonymously. Information gathering technology is promising to turn our work environments and public streets into an Orwellian nightmare. Video surveillance, genetic screening, global positioning systems, and purchasing profiles may leave us with little privacy. Information about our medical histories, phone numbers, addresses, and eating preferences is owned and traded by information brokers, including our government. Computer technology and digital networks such as the Internet or World-Wide-Web have changed the game, so-to-speak. These issues raise deep philosophical problems. What is intellectual property and can rights to intellectual works be justified? Are abstract ideas and information, even sensitive personal information, the proper subjects of ownership? Can computer software and other digital information be protected? How should legal systems accommodate the ownership of intellectual property in an information age and what role should privacy rights play? Should protection extend

6

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to the electronic frontier of the Internet and the World Wide Web? What is the moral position of those who violate the intellectual property rights of others and how does this compare to the violation of physical property rights? Throughout this work I develop answers to these questions or at least try to provide strategies for answering them. As we move further into what many call “the information age,” clarity is needed at the philosophical level so that morally justified policies and institutions can be adopted with respect to intellectual property and information control. It is my hope that this work will facilitate and further philosophical inquiry in this important area. Overview of a Theory In the broadest terms my goal in this work is to justify rights to intellectual and intangible property. Some think that this goal is easily attained and offer the following argument. Control should be granted to authors and inventors of intellectual property because granting such control provides incentives necessary for social progress. Society ought to maximize social utility; therefore, temporary rights to intellectual works should be granted. This strategy for justifying rights to intellectual property is typically given as the primary basis for Anglo-American copyright, patent, trademark, and trade secret institutions. Nevertheless, I think the argument is fundamentally flawed. With this in mind, I proceed on two fronts. First, a negative argument is given that undermines the aforementioned widely supported rule-utilitarian case for intellectual property. The hope is upon eliminating rule-utilitarian incentives-based arguments, the way will be cleared for a new Lockean justification. My positive argument begins with an account of Locke’s proviso that justified acquisitions of unowned objects must leave “enough and as good” for others.14 One way to interpret Locke’s requirement is that it ensures the position of others is not worsened. This can be understood as a version of weak Pareto-superiority. If the possession and exclusion of an intellectual work makes no one worse off, then the acquisition ought to be permitted. In clarifying the issues that surround a Pareto-based proviso on acquisition, I defend an account of bettering and worsening and offer a solution to the baseline problem—what two situations do we compare to determine if someone has been worsened.

Introduction and Overview

7

I argue that rights to intellectual works can be justified at both the level of acts and at the level of institutions. At both levels my argument turns on two features of intellectual property. First, intellectual works are non-rivalrous, meaning that they can be created, possessed, owned, and consumed by many individuals concurrently. Second, including allowances for independent creation, I argue that the frontier of intellectual property is practically infinite. Locke hints at this kind of practical infinity when he writes: “Nobody could think himself injured by the drinking of another man, though he took a good draught, who had a whole river of the same water left him to quench his thirst.”15 If I am correct, the case for Locke’s water-drinker and the author or inventor are quite alike. Finally, in light of the expansion of the Internet and the World Wide Web, a Lockean account of copyright, patent, and trade secret is developed along with an analysis of privacy, power, and the ownership of information. As already noted, governments as well as private companies are compiling digital profiles of us and selling this information to advertising agencies, insurance companies, private investigators, and the like. While it is true that this information could be used for our benefit, history is replete with examples of the converse. In the simplest terms, the problem I address is one of information control. Moreover, it does not matter what form the information takes —it could be a poem, a novel, a new invention, a computer program, military data, or sensitive personal information. The following quote from a Chinese military newspaper applies a number of these issues to information war: After the Gulf War, when everyone was looking forward to eternal peace, a new military revolution emerged. This revolution is essentially a transformation from the mechanized warfare of the industrial age to the information warfare of the information age. Information warfare is a war of decisions and control, a war of knowledge, and a war of intellect. The aim of information warfare will be gradually changed from ‘preserving oneself and wiping out the enemy’ to ‘preserving oneself and controlling the opponent.’ Information warfare includes electronic warfare, tactical deception, strategic deterrence, propaganda warfare, psychological warfare, network warfare, and structural sabotage.16

Our reliance on digital technology and computer networks has left us vulnerable to viruses, worms, programming miscalculations, and information war. Putting information war aside, it seems true to claim that the shift from an industrial economy to an information-

8

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based economy has raised the stakes concerning the control of information and ideas. The claim is not that controlling information used to be unimportant and now it is important—alas, censorship in various forms has always been with us. What I think is true, however, is that computer networks coupled with digitally stored information is significantly changing the way we interact and communicate. We will have to be much more careful about what we do and say in the future both publicly and privately. Any information or ideas that we disclose, including inventions, recipes, or sensitive personal information, might soon be bouncing around cyberspace for anyone to access. The stakes are high indeed. Notes 1. 2. 3. 4.

5.

6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16.

Quoted in Robert P. Benko’s, Protecting Intellectual Property Rights (Washington, DC: American Enterprise Institute for Public Policy Research, 1987). Copyright Law, State of Massachusetts, 1782. Nathaniel Shaler, Literary Property. Spooner notes that “One obstacle to the universal acknowledgment of property in ideas, has been this. Mankind freely give away so large a portion of their ideas, and so few of their ideas are of sufficient value to bring anything in the market, (except in the market of common conversation, where men mutually exchange their ideas) that persons, who have not reasoned on the subject, have naturally fallen into the habit of thinking, that ideas were not subjects of property; and have consequently been slow to admit that, as a matter of sound theory or law, men had a strict right of property in any of their ideas.” Lysander Spooner, The Law of Intellectual Property (Weston, MA: M & S Press, 1971), 37-38 (Originally published in 1855). Thomas Jefferson, “Letter to Isaac McPherson, Monticello, August 13, 1813,” in XIII The Writings of Thomas Jefferson, edited by A. Lipscomb (Washington, DC Issud under the auspices of the Thomas Jefferson Memorial Association of the United States, 1904), 326-38. James Boyle, Shamans, Software, and Spleens (Cambridge MA: Harvard University Press, 1996), Appendix. Business Software Alliance, http://www.nopiracy.com. For an illuminating account of how software is cracked, re-packaged, and uploaded for distribution, see David McCandless, “Warez Warz,” Wired Magazine 5.04 (April 1997). Steven Levy, “The Noisy War Over Napster,” Newsweek, June 5, 2000, p. 48. Ibid., Newsweek, June 5, 2000, p. 52. The manager was Ron Stone. Lars Ulrich, “It’s Our Property,” Newsweek, June 5, 2000, p. 54. J. P. Barlow, “Everything You Know About Intellectual Property Is Wrong,” in Intellectual Property: Moral, Legal, and International Dilemmas, edited by A. Moore (Lanham, MD: Rowman & Littlefield, 1997), chapter 15, 350. Barlow, “Everything You Know About Intellectual Property Is Wrong,” 351. John Locke, The Second Treatise of Government, edited by Peter Laslett (New York: New American Library, 1965), chapter 5, § 33. Locke, Second Treatise of Government, chapter 5, § 33. Jiefangjun Bao, Chinese Army Newspaper, cited by John Carlin, “A Farewell to Arms,” Wired Magazine (May 1997).

2 The Domain of Intellectual Property “What is it that we want to protect? First is the brilliant invention, the idea, the notion that makes a new product and the insight that makes a whole new industry. The second thing we want to protect is the investment and the hard work. This is the grunt work. This is the pick-and-shovel engineering that turns the idea, the prototype, into a reliable, distributable, maintainable, documented, supportable product.” —Robert Spinrad, Xerox Corp.1

Introduction Apart from allowing individuals to own cars, computers, land, or other tangible goods, intellectual property law enables individuals to obtain ownership rights to control works of literature, musical compositions, processes of manufacture, computer software, and the like. This latter form of ownership is typically called intangible or intellectual property. 2 Setting aside questions of justifying ownership, which shall be a primary concern in the next few chapters, there are questions concerning the nature and scope of intellectual property. These latter questions focus on the domain or subject matter of non-tangible systems of property protection. Before explicating the domain of intellectual property it would be helpful to briefly consider the historical origins of copyright and patent institutions. By reviewing the historical origins and mapping modern institutions we will arrive at a fairly clear picture of intellectual property. Historial Overview of Intellectual Property One of the first known references to intellectual property protection dates from 500 B.C. when chefs were granted year-long monopolies for creating culinary delights in the Greek colony of Sybaris. Phylarchus, a Greek historian wrote: 9

10

Intellectual Property and Information Control [i]f any caterer or cook invented a dish of his own which was especially choice, it was his privilege that no one else but the inventor himself should adopt the use of it before the lapse of a year, in order that the first man to invent a dish might possess the right of manufacture during that period, so as to encourage others to excel in eager competition with similar inventions.3

Perhaps one of the best known cases of intellectual property piracy comes from this period as well. I am referring to Hermodorus’ theft and subsequent sale of Plato’s speeches. It seems that even Ancient Greece had “bootleg” problems! There are at least three other notable references to intellectual property in ancient times—these cases are cited in Bruce Bugbee’s formidable work The Genesis of American Patent and Copyright Law.4 In the first case Vitruvius, another Aristophanes (257-180 B.C.), known as a critic from Greek Byzantium, is said to have revealed intellectual property theft during a literary contest in Alexandria. While serving as judge in the contest, Vitruvius exposed the false poets who were then tried, convicted, and disgraced.5 The second and third cases come from Roman times. Although there is no known Roman law protecting intellectual property, “Roman jurists discussed theoretical problems regarding its ownership, as, for example, the conflicting interests of the artist and of the owner of a table upon which the former had painted a picture.”6 There is also reference to literary piracy by Martial the Roman epigrammatist: Rumor asserts, Fidentinus, that you recite my works to the crowd, just as if they were your own. If you wish they should be called mine, I will send you the poems gratis; if you wish them to be called yours, buy my disclaimer of them.7

These examples are generally thought to be atypical, for as far as we know, there were no institutions or conventions of intellectual property protection in Ancient Greece or Rome. In fact the Romans generally scorned monopolies of any sort as exhibited by Zeno’s decree in 483 A.D. that no monopoly pertaining to food or clothing, even if ordered by another emperor, was to be permitted. From Roman times to the birth of the Florentine Republic there were many franchises, privileges, and royal favors granted. Bugbee distinguishes between franchises or royal favors and systems of intellectual property in the following way: “The term monopoly connotes the giving of an exclusive privilege for buying, selling, working or using a thing which the public freely enjoyed prior to the

The Domain of Intellectual Property

11

grant. Thus a monopoly takes something from the people. An inventor deprives the public of nothing which it enjoyed before his discovery, but gives something of value to the community by adding to the sum of human knowledge.”8 One of the first statutes that protected author’s rights was issued by the Republic of Florence on June 19, 1421, to Filippo Brunelleschi a famous architect.9 This statute not only recognized the rights of authors and inventors to the products of their intellectual efforts, it built in an incentive mechanism that became a prominent feature of Anglo-American intellectual property protection. For several reasons, including Guild influence, the Florentine patent statute of 1421 was stillborn, issuing only the single patent to Brunelleschi. The first lasting patent institution of intellectual property protection is found in the Venetian Republic of 1474. Proposed by committee the general patent statute passed the Venetian Senate by a vote of 116 to 10.10 The statute read as follows: We have among us men of great genius, apt to invent and discover ingenious devices; and in view of the grandeur and virtue of our City, more such men come to us every day from divers parts. Now, if provision were made for the works and devices discovered by such persons, or that others, who may see them could not build them and take the inventor’s honor away, more men would then apply their genius, would discover, and would build devices of great utility and benefit to our commonwealth . . . Therefore: Be it enacted that, by the authority of this Council, every person who shall build any new device in this City, not previously made in our Commonwealth, shall give notice of it to the office of our General Welfare Board when it has been reduced to perfection so that it can be used and operated. It being forbidden to every other person in any of our territories and towns to make any further device conforming with and similar to said one, without the consent and license of the author, for a term of 10 years. And if anybody builds it in violation hereof, the aforesaid author and inventor shall be entitled to have him summoned before any magistrate of this City, by which magistrate the said infringer shall be constrained to pay him hundred ducats; and the devise shall be destroyed at once.11

This statute appeared 150 years before England’s Statute of Monopolies and provided the foundation of the world’s first lasting institution of intellectual property protection. Moreover, the system was remarkably mature and sophisticated. The rights of inventors were recognized, an incentive mechanism was included, compensation for infringement was established, and a term limit on inventor’s rights imposed. Shortly thereafter, in 1486, one of the first true copyrights was granted to Marc’ Antonio Sabellico, a historiographer, giving him exclusive rights to his Decades rerum Venetarum.12

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For the most part though, American institutions of intellectual property protection are based on the English system that began with the Statute of Monopolies (1624) and the Statute of Anne (1709). Although many changes have since been made, the Statute of Monopolies is considered the basis of the British and American patent systems today: Generally regarded as the foundation of the present British patent system, the Statute of Monopolies—in keeping with its name—was concerned mainly with the problem of ending royally granted, monopolistic privileges. Those minor portions of the Statute relating directly to inventive property provided for the exemption and limitation of grants for innovations in the Realm . . . .The Statute of Monopolies, therefore, represented no advance over its Venetian predecessor of 1474, under which an inventor received his patent as a matter of right13

Nevertheless, the statute granted fourteen-year monopolies to authors and inventors and ended the practice of granting rights to “non-original/new” ideas or works already in the public domain. In contrast to patent institutions in Europe, literary works remained largely unprotected until the arrival of Gutenberg’s printing press in the fifteenth century. And again there were few true copyrights granted—most were grants, privileges, and monopolies.14 Bugbee notes, “Other . . . cities enacted legislation to promote their publishing trade, but Venice was foremost in this respect. . . . she supported rights of literary proprietorship in the world’s first known copyrights and produced a crude from of copyright law in the decree of 15441545 . . . .”15 The Statute of Anne (1709) is considered the first statute of modern copyright. The statute began, “Whereas printers, booksellers, and other persons have lately frequently taken the liberty of printing, reprinting, and publishing books without the consent of the authors and proprietors . . . to their very great detriment, and too often to the ruin of them and their families: for preventing therefore such practices for the future, and for the encouragement of learned men to compose and write books, be it enacted . . .” The law gave protection to the author by granting fourteen-year copyrights, with a second fourteen-year renewal possible if the author was still alive. The act also stated: And . . . if any bookseller, printer, or other person whatsoever, shall print, reprint, or import any such book or books, without the consent of the proprietor . . . then such offender shall forfeit such book or books to the proprietor of the copy thereof, who shall forthwith damage and make wastepaper of them; and farther, that every

The Domain of Intellectual Property

13

such offender shall forfeit one penny for every sheet which shall be found in his custody.

In the landmark case Miller v. Taylor (1769) the inherent rights of authors to control what they produce, independent of statute or law, was affirmed. While this case was later overruled in Donaldson v. Becket (1774), the practice of recognizing the rights of authors had begun. 16 Other European countries followed the example set by England and the influence of Napoleon helped to expand this practice to many countries on the continent including Belgium, Holland, Italy, and Switzerland. At the time, these ideas strongly influenced the American colonies and provided the foundation upon which American institutions of intellectual property were constructed. A Working Definition of Intellectual Property Intellectual property is generally characterized as non-physical property that is the product of cognitive processes and whose value is based upon some idea or collection of ideas.17 The res, or object, of intellectual property just is an idea or group of ideas. Typically, rights do not surround the abstract non-physical entity; rather, intellectual property rights surround the control of physical manifestations or expressions. Intellectual property protects rights to ideas by protecting rights to produce and control physical instantiations of those ideas.18 It should be noted that in producing or marketing physical manifestations of an idea, rights to physical resources must be acquired—in order to benefit from my idea through production I must first secure the resources that will constitute the physical product. On this view, intellectual property is non-tangible property that takes the form of abstract designs, patterns, ideas, or collections of ideas. Intellectual property rights are rights that surround control of the physical manifestations of these ideas.19 Two features that distinguish the Anglo-American systems of copyright, patent, trademark, and trade secret are the subject matter or domain of each system and the bundle of rights granted to property holders. In the first part of this chapter, I will explicate each of these regimes in terms of subject matter and rights conferred on property holders. Included will also be an examination of continental doctrine of moral rights or droits morals. As will be seen, this mapping exercise is, in a sense, limited, because many of the restrictions on the domain of intellectual property and the limitations on the rights

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of property holders are intimately tied to how these systems are justified. The second part of the chapter will consist of offering a new “justification-neutral” model of the domain of intellectual property. Ownership Rights and the Domain of Intellectual Property Following Hohfeld and others, the root idea of a “right” can be expressed as follows: To say someone has a right is to say that there exists a state of affairs in which one person (the right-holder) has a claim on act or forbearance from another person (the duty-bearer) in the sense that, should the claim be exercised or in force, and the act or forbearance not done, it would be justifiable, other things being equal, to use coercive measures to extract either the performance required or compensation in lieu of that performance.20

This broad characterization holds of both moral rights and legal rights. Property is a bundle of rights associated with an owner’s relation to a thing where each right in the bundle is distinct. A.M. Honoré has provided a lucid account of full legal ownership or property— the moral rights that underlie systems of intellectual property will be presented and defended in chapters 4-6. Full ownership includes: 1.

the right to possess—that is, to enjoy exclusive physical control of the thing owned;

2.

the right to use—that is, to personal enjoyment and use;

3.

the right to manage—that is, to decide how and by whom the object shall be used;

4.

the right to income—that is, to enjoy the benefits derived from personal use;

5.

the right to the capital—that is, the power to alienate the thing and to consume, waste, modify, or destroy it;

6.

the right to security—that is, immunity from expropriation;

7.

the power of transmissibility—that is, the power to bequeath the object;

8.

absence of term—that is, the indeterminate length of one’s ownership rights;

9.

prohibition of harmful use—that is, one’s duty to forbear from using the thing to harm others;

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15

10.

liability to execution—that is, liability to having the thing taken away for repayment of debt, and;

11.

residuary character—that is, the existence of rules governing the reversion of lapsed ownership rights.21

It is conceded that there are various restricted forms of ownership which omit one or more of these incidents from the bundle of owner’s rights. Nevertheless, it should be noted that property rights are conceptually complex—they are complex sets of duties, obligations, and claims. Rights are not free floating moral entities—they are complex sets of moral claims, duties, obligations, powers, and immunities. Some have argued that if this is the case then we should dispense with talk of rights and merely talk of duties, obligations, etc. We could do this but then tedium has its costs, too, and there is nothing wrong with talking in terms of rights so long as we do not lose sight of the fact that they are conceptually complex. Intellectual property regimes are explicit about the sticks contained in the bundle of rights constituting copyright,22 patent,23 trademark,24 and trade secret.25 As each domain or subject matter is mapped out, the bundles of rights conferred on property holders found in each regime will be introduced as well. The Domain of Intellectual Property At the most practical level the subject matter of intellectual property is largely codified in Anglo-American copyright, patent, and trade secret law, as well as in the moral rights granted to authors and inventors within the continental European doctrine. Although these systems of property encompass much of what is thought to count as intellectual property, they do not map out the entire landscape. 26 Even so, Anglo-American systems of copyright, patent, trademark, and trade secret law, along with certain continental doctrines, provide a rich starting point. We’ll take them up in turn. Copyright The domain of copyright is expression. Section 102 of the 1976 Copyright Act determines the subject matter of copyright protection: § 102: (a) Copyright protection subsists, in accordance with this title, in original works of authorship fixed in any tangible medium of expression, now known or later devel-

16

Intellectual Property and Information Control oped, from which they can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or device.

Works of authorship include the following categories: 1.

literary works, including computer software27 ;

2.

musical works, including any accompanying words;

3.

dramatic works, including any accompanying music;

4.

pantomimes and choreographic works;

5.

pictorial, graphic, and sculptural works;

6.

motion pictures and other audiovisual works;

7.

sound recordings;

8.

architectural works;28 and

§ 102 (b) In no case does copyright protection for an original work of authorship extend to any idea, procedure, process, system, method of operation, concept, principle, or discovery, regardless of the form in which it is described, explained, illustrated, or embodied in such work.29

Pamela Samuleson has argued that software, similar to semiconductor chips, should receive a sui generis form of protection.30 One of the problems with protecting software is what to protect. Do we protect the source code or the behavior of a program or the look and feel. Samuleson and others propose and defend a multi-layered model of protection—in brief, copyright protects the source code and shortterm (three years) anti-cloning laws that block product entry protect software behavior and maybe look and feel as well. To continue, the scope or subject matter of copyright, as protected under federal law or the Copyright Act, is limited in three important respects. First, for something to be protected, it must be original. Thus, the creative process by which an expression comes into being becomes relevant. Even so, the originality requirement has a low threshold. “Original” in reference to a copyrighted work means that the particular work “owes its origin” to the author and does not mean that the work must be ingenious or even interesting. Minimally, the work must be the author’s own production; it cannot be the result of copying.31 In Feist Publications, Inc. v. Rural Telephone Service Company 32 (1991) the United States Supreme Court made it clear that the originality requirement is a crucial prerequisite for

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17

copyrightability. “The sine qua non of copyright is originality. To qualify for copyright protection, a work must be original to the author . . .” When deciding the issues of originality and copyright infringement courts examine expressions and not the abstract ideas from which the expressions are derived.33 A second requirement that limits the domain of what can be copyrighted is that the expression must be “non-utilitarian” or “non-functional” in nature. Utilitarian products, or products that are useful for work, fall, if they fall anywhere, within the domain of patents. As with the originality requirement, the non-utilitarian requirement has a low threshold because the distinction itself is contentious. An example of an intellectual work that bumps against the non-functional requirement is copyright protection of computer software.34 While a computer program as a whole is functional and useful for producing things, its object code and source code have been deemed to be protectable expressions. In response to the seemingly difficult task of defining the functional aspects of intellectual works, the courts have invoked this requirement infrequently.35 Finally, the subject matter of statutory copyright is concrete expression, meaning that only expressions as fixed in a tangible and permanent medium can be protected.36 The crucial element is that there be a physical embodiment of the work. Moreover, within the system of copyright, the abstract idea, or res, of intellectual property is not protected.37 Author’s rights only extend over the actual concrete expression and the derivatives of the expression—not to the abstract ideas themselves. For example, Einstein’s Theory of Relativity, as expressed in various articles and publications, is not protected under copyright law. Someone else may read these publications and express the theory in her own words and even receive a copyright for her particular expression. Some may find this troubling,38 but such rights are outside the domain of copyright law. The individual who copies abstract theories and expresses them in her own words may be guilty of plagiarism, but she cannot be held liable for copyright infringement. The distinction between the protection of fixed expressions and abstract ideas has led to the “merger doctrine”: If there is no way to separate idea from expression, then a copyright cannot be obtained. Suppose that I create a new recipe for spicy Chinese noodles and there is only one way, or a limited number of ways, to express the

18

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idea. If this were the case, then I could not obtain copyright protection, because the idea and the expression have been merged. Granting me a copyright to the recipe would amount to granting a right to control the ideas that make up the recipe.39 The Copyrights There are five exclusive rights that copyright owners enjoy and three major restrictions on the bundle. The five rights are:40 1.

the right to reproduce the work,

2.

the right to adapt it or derive other works from it,

3.

the right to distribute copies of the work,

4.

the right to display the work publicly, and

5.

the right to perform it publicly.

Each of these rights may be parsed out and sold separately. “The owner of any particular exclusive right is entitled, to the extent of that right, to all of the protection and remedies accorded to the copyright owner by this title.”41 Moreover, it is important to note the difference between the owner of a copyright and the owner of a copy (the physical object in which the copyrightable expression is embodied). Although the two persons may be the same they typically are not. Owners of copies or particular expressions who do not own the copyright do not enjoy any of the five rights listed above. The purchaser of a copy of a book from a publisher may sell or transfer that book, but may not make copies of the book, prepare a screenplay based on the book, or read the book aloud in public. The three major restrictions on the bundle of rights that surround copyright are fair use, the first sale doctrine, and limited duration.42 Although the notion of “fair use” is notoriously hard to spell out, it is a generally recognized principle of Anglo-American copyright law. Every author or publisher may make limited use of another’s copyrighted work for such purposes as criticism, comment, news reporting, teaching, scholarship, and research. The enactment of fair use, then, restricts the control that copyright holders would otherwise enjoy.

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19

The first sale doctrine as codified in section 109(a) limits the rights of copyright holders in controlling the physical manifestations of their work after the first sale. 43 “[O]nce a work is lawfully transferred the copyright owner’s interest in the material object (the copy or the phonorecord) is extinguished so that the owner of that copy or phonorecord can dispose of it as he or she wishes.”44 The first sale rule prevents a copyright holder who has sold copies of the protected work from later interfering with the subsequent sale of those copies. In short, the owners of copies can do what they like with their property short of violating the copyrights mentioned above. Finally, the third major restriction on the bundle of rights conferred on copyright holders is that they have a built-in sunset, or limited term. All five rights lapse after the lifetime of the author plus seventy years—or in the case of works for hire, the term is set at ninety-five years from publication or 120 years from creation, whichever comes first.45 Patents Patent protection is the strongest form of protection, in that a twenty-year exclusive monopoly is granted over any expression or implementation of the protected work.46 The domain or subject matter of patent law is the invention and discovery of new and useful processes, machines, articles of manufacture, or compositions of matter. There are three types of patents recognized by patent law: utility patents, design patents, and plant patents. Utility patents protect any new, useful, and nonobvious process, machine, article of manufacture, or composition of matter, as well as any new and useful improvement thereof. Design patents protect any new, original, and ornamental design for an article of manufacture. Finally, the subject matter of a plant patent is any new variety of plant. As with copyright, there are restrictions on the domain of patent protection. The Patent Act requires usefulness, novelty, and nonobviousness of the subject matter. The usefulness requirement is typically deemed satisfied if the invention can accomplish at least one of its intended purposes. Needless to say, given the expense of obtaining a patent, most machines, articles of manufacture, and processes are useful in this minimal sense. A more robust requirement on the subject matter of a patent is that the invention defined in the claim for patent protection must be

20

Intellectual Property and Information Control

new or novel. There are several categories or events, all defined by statute, that can anticipate and invalidate a claim of a patent.47 In general, the novelty requirement invalidates patent claims if the invention was publicly known before the applicant for patent invented it.48 The following statutes determine novelty: 1.

The invention was publicly known in the United States before the patentee invented it.

2.

The invention was publicly used in the United States either (a) before the patentee invented it, or (b) more than one year before the patentee filed the patent application.

3.

The invention was described in a printed publication anywhere in the world either (a) before the patentee invented it, or (b) more than one year before the patentee filed the patent application.

4.

The invention was patented in another patent anywhere in the world either (a) before the patentee invented it, or (b) more than one year before the patentee filed the patent application.

5.

The invention was on sale in the United States more than one year before the patentee filed the patent application.

6.

The invention was invented by another person in the United States before the patentee invented it, and such other person did not abandon or conceal the invention.

7.

The invention was described in a patent granted on a patent application filed in the United States before the patentee made the invention.49

If any of these statutes hold then the application for patent protection fails the novelty test and is not granted.50 In addition to utility and novelty, the third restriction on patentability is non-obviousness. United States patent law requires that the invention not be obvious to one ordinarily skilled in the relevant art at the time the invention was made. A hypothetical individual is constructed and the question is asked, “Would this invention be obvious to her?” If it would be obvious to this imaginary individual then the patent claim fails the test.51 Patent Rights In return for public disclosure and the ensuing dissemination of information the patent holder is granted the following rights:

The Domain of Intellectual Property 1.

the right to make;

2.

the right to use;

3.

the right to sell the patented item, and;

4.

the right to authorize others to sell the patented item.52

21

The bundle of rights conferred by a patent exclude others from making, using, or selling the invention regardless of independent creation. For twenty years the owner of a patent has a complete monopoly over any expression of the idea(s). Like copyright, patent rights lapse after a given period of time. But unlike copyright protection, these rights preclude others who independently invent the same process or machine from being able to patent or market their invention. Thus, obtaining a patent on a new machine excludes others from independently creating their own machine (similar to the first) and securing owner’s rights.53 Trade Secret The subject matter of trade secret is almost unlimited in terms of the content or subject matter that may be protected and typically relies on private measures, rather than state action, to preserve exclusivity: A trade secret is any information that can be used in the operation of a business or other enterprise and that is sufficiently valuable and secret to afford an actual or potential economic advantage over others.54

As long as certain definitional elements are met, virtually any type of information or intellectual work is eligible for trade secret protection. It may be a formula for a chemical compound; a process of manufacturing, treating, or preserving materials; a pattern for a machine or other device; or a list of customers. The two major restrictions on the domain of trade secrets are the requirements of secrecy and competitive advantage. Secrecy is determined in reference to the following three rules of thumb. An intellectual work is not a secret if: 1.

it is generally known within the industry,

2.

it is published in trade journals, reference books, etc., and,

3.

it is readily copyable from products on the market.

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Intellectual Property and Information Control

If the owner of a trade secret distributes a product that discloses the secret in any way, then trade secret protection is lost. Imagine that Coke’s secret formula could be deduced from a chemical analysis of a sample. If this were the case, then Coke Inc. would lose trade secret protection for its recipe. Competitive advantage is a weaker requirement and is satisfied so long as a company or owner obtains some benefit from the trade secret. Although trade secret rights have no built-in sunset they are extremely limited in one important respect. Owners of trade secrets have exclusive rights to make use of the secret but only as long as the secret is maintained.55 If the secret is made public by the owner, then trade secret protection lapses and anyone can make use of it. Moreover, owner’s rights do not exclude independent invention or discovery. Within the secrecy requirement, owners of trade secrets enjoy management rights and are protected from misappropriation. This latter protection is probably the most important right given the proliferation of industrial espionage and employee theft of intellectual works. Trademark The domain or subject matter of trademark is, generally speaking, the good will or good name of a company. A trademark is any word, name, symbol, or device, or any combination thereof adopted by a manufacturer or merchant to identify her goods and distinguish them from goods produced by others56 (e.g., the “Energizer bunny”). The Federal Trademark act notes that trademark law has two purposes: One is to protect the public so it may be confident that, in purchasing a product bearing a particular trade-mark which it favorably knows, it will get the product which is asked for and wants to get. Secondly, where the owner of a trademark has spent energy, time, and money in presenting to the public the product, he is protected in his investment from its misappropriation by pirates and cheats.57

A major restriction on what can count as a trademark is whether or not the symbol is used in everyday language. In this respect, owners of trademarks do not want their symbols to become too widely used because once this occurs the trademark lapses. An example of this restriction eliminating a word from trademark protection is “aspirin”—as the word became a part of the common culture rights to exclusively use the trademark lapsed.

The Domain of Intellectual Property

23

Ownership of a trademark confers upon the property holder the right to use a particular mark or symbol and the right to exclude others from using the same (or similar) mark or symbol. The duration of these rights is limited only in cases where the mark or symbol ceases to represent a company or interest, or becomes entrenched as part of the common language or culture. Protecting Mere Ideas Outside of the regimes of copyright, patent, trademark, and trade secret, there is a substantial set of case law that allows individuals to protect mere ideas as personal property. This system of property is typically called the law of ideas.58 A highly publicized case in this area is Buchwald v. Paramount Pictures 59 concerning the Eddie Murphy movie Coming to America. Buchwald approached Paramount Pictures with a movie idea and it was agreed that if a movie was made following Buchwald’s premise he would receive compensation. After several years of false starts and negotiations Paramount notified Buchwald that the movie based on his idea was not going to be produced. Shortly after this notification, Coming to America was released and credit was given to Eddie Murphy. Even though the movie lost money, Buchwald sued and received compensation. The law of ideas is typically applied in cases where individuals who are unaffiliated with companies produce ideas and submit them to corporations expecting to be compensated for any use thereof. In certain cases, others who use these ideas without authorization have misappropriated property and can be prevented from using or disclosing the ideas until they have compensated the idea owners. Before concluding that an author has property rights in her idea(s), courts require the idea(s) to be novel or original60 and concrete.61 Compensation is offered only in cases of misappropriation.62 Ideas do not have to meet a high standard of novelty to merit protection as property. Minimally, the idea must demonstrate a degree of novelty and originality sufficient to show that it was not copied and that it is of value to the idea originator. The requirement of concreteness limits the domain of what can be protected as property by requiring the idea to be fixed in tangible form and mature. Fixation is easily understood along the lines of the fixation requirement in copyright law but maturity is another matter. This system of

24

Intellectual Property and Information Control

property does not protect ideas that are broad, vague, or ideas that require extensive investigation and research—these ideas would not be “mature.” Generally, what counts as a protectable idea is decided on a case by case basis with reference to these restrictions. Property holders in this system have complete control over their property with the exception of excluding others from obtaining rights to the same idea through independent creation. Thus the rights conferred on property holders in this system are similar to the conjunction of rights conferred on holders of copyrights and trade secrets. Comparing Systems This general framework of subject matter, rights, and full ownership provides a useful set of tools for comparing different forms of intellectual property within the Anglo-American tradition. Consider the following tables. Table 2.1 Systems of Property63

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25

Table 2.2 Simplified Relationships Between Patents, Copyrights, Trademarks, and Trade Secrets64

Trade secret subject matter is broader than the subject matter or domain of other forms of intellectual property and does not include a fixation requirement. Aside from the secrecy and competitive advantage requirements, potentially anything can become the subject of a trade secret. Thus in many respects the domain of trade secrets includes that of copyright, patent,65 trademark, and the law of ideas. The duration of rights to trade secret, trademark, and the law of ideas, like the duration of rights in real or tangible property, is potentially unlimited. Rights to absence of term distinguishes these regimes of property from that of copyright and patent. Generally, copyrights lapse after the lifetime of the author plus seventy years and patent rights lapse after twenty years. Of all of the forms of intellectual property, patents provide the most extensive set of rights for the property holder within the limited term requirement. Patent protection grants inventors of new and useful processes, machines, articles of manufacture, and compositions of matter66 the “right to exclude others from making, using or selling” the invention67 and the right to prevent the importation of

26

Intellectual Property and Information Control

products made with a patented process.68 Thus, the bundle of rights that surround patent protection allow property holders exclusive monopoly rights. Unlike copyright, trade secret, and the law of ideas, and similar to trademarks, a patent permits the owner to exclude others from marketing or using any implementation of the patented invention. Patent rights even allow owners to sue for damages when users know nothing of the patented idea and use it by accident. In this last respect the rights conferred on patent holders are more like the rights that surround ownership of physical goods. Droits Morals: Continental Systems of Intellectual Property Article 6 bis of the Berne Convention articulates the notion of “moral rights” that are included in continental European intellectual property law: Independently of the author’s economic rights, and even after the transfer of the said rights, the author shall have the right to claim authorship of the work and to object to any distortion, mutilation or other modification of, or other derogatory action in relation to, the said work, which would be prejudicial to his honor or reputation.

The doctrine protects the personal rights of creators, as distinguished from their economic rights, and is generally known in France as “droits morals” or “moral rights.” These moral rights consist of the right to create and to publish in any form desired, the creator’s right to claim the authorship of his work, the right to prevent any deformation, mutilation or other modification thereof, the right to withdraw and destroy the work, the prohibition against excessive criticism, and the prohibition against all other injuries to the creator’s personality.69 Much of this doctrine has been incorporated in the Berne Convention: When the artist creates, be he an author, a painter, a sculptor, an architect or a musician, he does more than bring into the world a unique object having only exploitive possibilities; he projects into the world part of his personality and subjects it to the ravages of public use. There are possibilities of injury to the creator other than merely economic ones; these the copyright statute does not protect.70

It should be noted that granting moral rights of this sort goes beyond a mere expansion of the rights conferred on property holders within the Anglo-American tradition. While many of the moral rights listed above could be incorporated into copyright and patent law, the overall content of these moral rights suggests a new domain of intellectual property protection. This new domain of moral rights

The Domain of Intellectual Property

27

stands outside of the economic– and utilitarian– based rights granted within the Anglo-American tradition. This is to say that independent of social and economic utility, and sometimes in conflict with it, authors and inventors have rights to control the products of their intellectual efforts. A Generic View of Intellectual Property To this point, the domain of intellectual property has been mapped by focusing on the Anglo-American systems of copyright, patent, trademark, trade secret, the law of ideas, and the European doctrine of moral rights. But with respect to Anglo-American institutions this mapping exercise has been, in a sense, limited. Many of the aforementioned restrictions on the domain of intellectual property and the limitations on the rights of property holders are intimately tied to how these systems are justified.71 It follows that a rejection of how these systems are justified will lead to a rejection of many utilitybased limitations placed on subject matter and owner’s rights. It may be the case that an alternative justification of intellectual property will also justify similar limitations. This remains to be seen. Although modern Anglo-American systems of intellectual property have been “justified” on rule-utilitarian grounds, it is possible to filter out the utilitarian components and arrive at a more generic model.72 In a sense we are working backwards so that upon rejecting rule-utilitarian attempts to justify systems of intellectual property we have a generic model that is largely “justification” neutral. First, a new model will be presented and second, each regime of intellectual property will be reexamined with an eye towards a “justification” neutral exposition. Sadly as will be seen, this generic “justification” neutral model will be sketchy precisely because restrictions on subject matter and owner’s rights are so intimately tied to the method of justification.73 Intellectual property is generally characterized as non-physical property where owner’s rights surround control of physical manifestations or tokens of some abstract idea or type. As we shall see this general definition of intellectual property may be inadequate in cases where there is no type/token distinction possible—e.g., where the expression and the idea are merged. Even so it will be argued that as a general model the type/token distinction is plausible. Ideas or collections of ideas are readily understood in terms of non-physi-

28

Intellectual Property and Information Control

cal types, while the physical manifestations of ideas can be modeled in terms of tokens. Intellectual property rights surround control of physical tokens, and this control protects rights to types or abstract ideas.74 For example, the ownership of Windows grants Microsoft a level of control over every physical embodiment of a certain kind— over every token of the type. The intellectual property regime of trademark is easily modeled in terms of a type/token distinction. Each individual mark or symbol affixed to some product is a token of the quality and good will of a company. For instance, the mark “ ” is a token of a type that is affixed to many products and represents the quality and good will of Apple Incorporated. Moreover, it is easy to imagine how this system of property would be without the restriction of common use which is justified on utilitarian grounds.75 The restriction of common use eliminates owner’s rights when the symbol or mark becomes part of the culture or language. The general rule-utilitarian justification given for this restriction is that allowing exclusive control over symbols and marks that are commonly used leads to a decrease in overall utility. Although an alternative justification of the Anglo-American system of trademark may yield a similar restriction, this need not be the case. As with trademark, trade secret fits well with our type/token distinction given the subject matter that is protected. Formulas, patterns, designs, and compilations of information are easily understood as types and their physical instantiations as tokens. An example is Coca Cola’s secret recipe where the tokens are individual cans of coke and the type is the recipe itself. The property system of trade secret protects formulas, patterns, designs, and compilations of information from misappropriation.76 The major restriction placed on owner’s rights is the requirement of secrecy. The primary issue involved in trade secret protection is one of privacy and the rights of individuals and companies to control their own private ideas from wrongful invasion and seizure. The restriction of secrecy is an essential element of trade secret because protection from misappropriation is the extent of owner’s rights and others cannot misappropriate things that are commonly known. In this way the restriction stands or falls with the system of property. Alternative justifications of the system would then seem to automatically justify the restriction.

The Domain of Intellectual Property

29

Patents protect the invention and discovery of new and useful processes, machines, articles of manufacture, or compositions of matter.77 In terms of a type/token distinction, types are the collection of ideas that make up new and useful processes, machines, or compositions of matter and tokens are any physical manifestations thereof. The restrictions of functionality, novelty, and non-obviousness are all justified along utilitarian lines. Patents are granted to inventors when their inventions are functional, novel, and non-obvious because restricting the domain of patent law in these ways typically leads to an increase in overall utility. Rights are granted as incentive for the production of intellectual works and the following dissemination of information. Once again, although an alternative justification of the Anglo-American system of patent may yield similar restrictions, this need not be the case. As noted before, in one important respect the rights conferred on owners of patents are more robust than the rights granted to property holders of copyrights and trade secrets. Unlike copyright and trade secret, patents exclude the possibility of independent invention as grounds for granting rights. As with the previously mentioned restrictions, these monopoly rights are typically justified in terms of promoting the common good. Owners of patents, and to some extent trademarks, are given exclusive control over an intellectual work even to the extent of excluding others who independently create the same invention.78 Thus those who hold patents are in a position of great power—for example, consider the “land grab” that is currently happening with DNA information. Obviously, alternative justifications of this particular system of property may not grant such robust rights to property holders. The intellectual property system of copyright protects any original expression fixed in a tangible medium. As with the other regimes of intellectual property, copyright fits well with a type/token model. Expressions are tokens of ideas or collections of ideas and ideas just are types of which there can be many expressions. An example would be Einstein’s Theory of Relativity which, as a type, can have many physical instantiations or tokens. And in fact this is exactly the case. Many books (i.e., concrete tokens) have been printed explaining, augmenting, and challenging the Theory of Relativity (i.e., non-physical type).

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Intellectual Property and Information Control

Now things get messy very fast when one tries to map all copyright in terms of a type/token distinction.79 Imagine art that has been traditionally protected, yet has no underlying idea or collection of ideas that can be considered a separable distinct type. For example, a hastily shot photograph, a modern painting where paint is haphazardly splashed on canvass, or freeform blues or jazz, etc. Maybe there are brute expressions with no underlying idea(s). Moreover, what is important in some protectable intellectual work is not the abstract idea or type, but the style of the expression itself. In these latter cases the idea and the expression of the idea have been merged. It may be argued that it is not the plot or the characters that make Hemingway’s The Sun Also Rises but rather his distinct style of expression. So it would seem that mapping all of copyright in terms of a type/token distinction would be a mistake. As noted before, copyright protects original expressions from being copied and this includes any expression that is substantially similar.80 What this means is that individuals cannot merely copy an expression and change a few things around. If someone were to copy The Sun Also Rises and change the sentences slightly they would still infringe Hemingway’s copyright. The rights conferred on the owners of a copyright allow them to control exact copies of their work and any copies that are substantially similar. In this way physical expressions become type-like and can thus be modeled in terms of a type/token distinction. For example, within the domain of copyright, Hemingway’s book The Sun Also Rises is both a type and a token. It is a type because Hemingway can control any exact copy of it and any copy that is substantially similar. Moreover, it is a token because it is a physical manifestation of something that could take many physical forms. Also, while it may be impossible to separate an idea from its mode of expression—maybe the specific way in which the idea is expressed is integral to the idea itself—we can still draw a type/token distinction. Within the Anglo-American tradition the restrictions of originality, non-usefulness, and fixation on the subject matter of copyright are given both utilitarian-based justifications and alternative justifications. Given this, I will put off considering these restrictions until some alternative justification is offered. Finally, a type/token distinction fits well with the subject matter that constitutes the law of ideas. Property holders within this system

The Domain of Intellectual Property

31

retain rights to the abstract ideas themselves by controlling physical manifestations of those ideas. The restrictions of novelty, maturity, and misappropriation are typically given rule-utilitarian based justifications.81 A system of intellectual property protection for particular ideas is necessary for an optimal amount of social progress. Moreover, a system that includes these restrictions is better than one with some other set of restrictions or no restrictions. It remains to be seen whether or not an alternative justification of the law of ideas will retain these restrictions. Conclusion In mapping out the domain or subject matter of intellectual property, I have relied heavily on the modern Anglo-American systems of copyright, patent, trademark, trade secret, and the law of ideas. Although these systems include much of what we think should count as intellectual property, they do not map out the entire landscape. Consider the following case. Imagine an individual investing a large amount of time and resources in developing a new and revolutionary theory of literary critical assessment only to find that his market share (assuming there is a market share) has been gobbled up by someone who has copied his abstract ideas and created a second, less expensive, yet different expression. As noted, Anglo-American copyright law only protects particular expressions not abstract ideas or theories, so the usurper may express his own version of aesthetic critical assessment and obtain a copyright in his original expression. Surely something has gone awry in this case given that if anything should be protected, it should be the creator’s rights to his/her theories. We say Einstein’s Theory of Relativity because it is his theory, his creation, no matter how it is expressed. In this respect there is a rather large hole in modern Anglo-American theories of intellectual property. As was discussed earlier and in contrast to the Anglo-American system, the continental Europeans have a more inclusive system of copyright protection centered around creator’s rights.82 Notice that such rights would make copyrights more like patents in that the totality of the idea and expression could be protected. Thus by including author’s rights into the bundle of rights that surround copyright, we obtain a more robust domain of intellectual property. In 1988 the United States became the seventy-eighth nation to join the Berne

32

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Copyright Convention. Along with the economic rights previously mentioned, the Berne Convention grants authors rights of paternity and integrity. In recent years, to reflect statutes found in the Berne Convention Treaty, the United States has moved to expand copyright protection to include creator’s rights. It may be argued that the domain of intellectual property is still impoverished in certain respects. But the purpose of this chapter has not been to exhaustively present and examine the entire domain of intellectual and intangible property. Rather, the goal has been to examine a good portion of the domain in the hopes not only of clarifying what counts as intellectual property, but laying the foundation for alternative justifications. Notes 1. 2. 3. 4.

5.

6. 7. 8.

Quoted in Robert P. Benko’s, Protecting Intellectual Property Rights (Washington, DC: American Enterprise Institute for Public Policy Research, 1987). Actually, I will use intangible property as a broader notion than intellectual property—the former includes the latter as well as other kinds of property like personality rights (owning one’s public image, etc.), information, and stock options. Quoted by Athenaeus, The Deipnosophists (New York:G.P. Putman’s Sons, 1927), translated by C. Burton Gulick, 348-49. B. Bugbee, Genesis of American Patent and Copyright Law (Washington, DC: Public Affairs Press, 1967). For other works tracing the historical foundations of intellectual property see, Nathaniel S. Shaler, Thoughts on the Nature of Intellectual Property and Its Importance to the State (Cambridge, MA: Welch Bigelow, and Company, 1877); Frank D. Prager, “A History of Intellectual Property from 1545 to 1787” Journal of the Patent Office Society, XXVI (November 1944) and “The Early Growth and Influence of Intellectual Property” Journal of the Patent Office Society, XXVII (February 1952); Allan Gomme, Patents of Invention: Origin and Growth of the Patent System in Britain (London, Longmans Green, 1946); Giulio Mandich, “Venetian Origins of Inventors’ Rights” trans. Frank D. Prager, Journal of the Patent Office Society, XLII (June 1960); W. S. Holdsworth, A History of English Law (London, Methuen Company, 1903); and W. Hulme “The History of the Patent System under the Prerogative and at Common Law” Law Quarterly Review XII (1896). For references to intellectual or literary piracy see Plato, Apology; translated by H. North Fowler (London, W. Heinemann, 1917), 98-99, The Frogs in Aristophanes, translated by B. Rogers (London, 1927) II, 302-305; G. H. Putnam, Authors and their Public in Ancient Times (New York:G.P. Putman’s Sons,1894), 202; H. L. Pinner, The World of Books in Classical Antiquity (Leiden, A.W. Sijthoff,1948), 25, 38-43. Cited in B. Bugbee, Genesis, 167, n13. Bugbee, Genesis, 167, n16. Martial, Epigrams, trans. Walter C. A. Ker (London and New York, 1920-25, Cambridge MA: Harvard University Press, 1943) I, 46-47. Cited in Bugbee, Genesis, 167, n15. Bugbee, Genesis, 7.

The Domain of Intellectual Property 9.

10. 11. 12. 13. 14. 15. 16. 17.

18. 19. 20.

21. 22. 23. 24. 25. 26. 27. 28. 29.

33

The preamble read: “Considering that the admirable Filippo Brunelleschi, a man of the most perspicacious intellect, industry and invention, a citizen of Florence, has invented some machine or kind of ship, by means of which he thinks he can easily, at any time, bring in any merchandise and load on the river Arno and on any other river or water, for less money than usual,. . . ; and that he refuses to make such machine available to the public, in order that the fruit of his genius and skill may not be reaped by another without his will and consent; . . . And desiring that this matter, so withheld and hidden without fruit, shall be brought to the light, to be of profit both to said Filippo and to our whole country and others; and that some privilege be created for said Filippo, as hereinafter described, so that he may be animated more fervently to even higher pursuits, and stimulated to more subtle investigations, . . .” F. Peager, “Brunelleschi’s Patent,” Journal of Patent Office Society (herafter JPOS), XXXVIII (February 1946), 127. See Bugbee, Genesis, 22. G. Mandich, Venetian Inventors’ Rights,” translated by F. Prager, JPOS, XXX (March, 1948): 172-73. Bugbee, Genesis, 45. Bugbee, Genesis, 39. For example, in 1469 John Speyer was granted the right to conduct all printing in Venice for a term of five years. Bugbee, Genesis, 47. Miller v. Taylor (1769), 4 Burr. 2303; Donaldson v. Becket (1774), 4 Burr. 2408. For a similar view, see J. Hughes “The Philosophy of Intellectual Property” in Intellectual Property: Moral, Legal, and International Dilemmas, edited by A. Moore (Lanham, MD: Rowman & Littlefield, 1997), chapter 6. Also note that the proposed working definition does not distinguish between owing ideas and owning expressions of ideas—as we shall see, copyright protection does not extend to mere ideas but only to fixed expressions. Trade secret protection and what is commonly known as the “law of ideas” do extend to cover ideas. I use the term “idea” loosely meaning theories, abstract designs, and theoretical constructs. For a discussion of discovered intellectual property compared to created intellectual property see the relevant section of chapter 5. Lawrence Becker, Property Rights, Philosophic Foundations (London: Routledge & Kegan Paul, 1977). Hohfeld distinguishes four types of rights, claim-rights, liberty-rights, power-rights, and immunity-rights. See W. N. Hohfeld, “Fundamental Legal Conceptions,” Yale Law Journal (New Haven, CT: Yale University Press, 1919). Note that we are considering moral rights here, not legal rights. Following Honoré, 107-47 and Becker, Property Rights, Philosophic Foundations, 19. It should be noted that Honoré giving an analysis of full legal ownership. 17 U.S.C. § 106 (1988) (enumerating rights belonging to copyright owner). 35 U.S.C. § 261 (1988) (enumerating rights belonging to patent owner). 15 U.S.C. § 1174 (1988) (enumerating rights belonging to trademark owner). As codified in various state statutes. Personality ownership, stock options, and the like, are areas of intellectual property not included in this overview. Copyright Act, 17 U.S.C. § 102 (1988). The 1990 Architectural Works Copyright Protection Act amended the 1976 Copyright Act to afford explicit protection to works of architecture. 17 U.S.C § 102 (1988).

34 30.

31. 32. 33. 34. 35.

36.

37. 38. 39. 40. 41. 42.

43. 44. 45.

46.

Intellectual Property and Information Control See P. Samuleson, “A Manifesto Concerning the Legal Protection of Computer Programs,” Columbia Law Review 94 (1994): 2308. See also, “Innovation and Competition: Conflicts over Intellectual Property Rights in New Technologies” in Owning Scientific and Technical Information, ed J. Snapper & V. Weil (New Brunswick, NJ: Rutgers Press, 1989), 173. See Bleistein v. Donaldson Lithographing Co., 188 U.S. 239 (1903), and Time Inc. v. Bernard Geis Associates, 293 F. Supp. 130 (S.D.N.Y. 1968). Feist Publications, Inc. v. Rural Telephone Service Company 499 U.S. 340 (1991). Infringement is determined often by substantial similarity tests. See Nichols v. Universal Pictures Corp., 45 F.2d 49 (2d Cir. 1930), and Sheldon v. Metro-Goldwyn Pictures Corp., 81 F.2d 49 (2d Cir.), cert .denied, 298 U.S. 669 (1936). For a more detailed discussion of this see P. Samuleson, “Innovation and Competition,” 173. See Kieselstein-Cord v. Accessories By Pearl, Inc. U.S.C. of Appeals, Second Circuit, 1980, Carol Barnhart Inc. v. Economy Cover Corporation, U.S.C. of Appeals, Second Circuit, 1985, and Brandir International, Inc. v. Cascade Pacific Lumber Co. U.S.C. of Appeals, Second Circuit, 1987. See Baltimore Orioles, Inc. v. Major League Baseball Players Ass’n, 805 F.2d 663 (7th Cir. 1986), cert. denied, 480 U.S. 941 (1987), and National Football League v. McBee & Bruno’s, Inc., 792 F.2d 726 (8th Cir. 1986). It should be noted that State, or common law copyright, still protects unfixed works — for example, the choreography of a play in production. See 17 U.S.C. § 102(b) (1988). This kind of worry is, in part, the basis for the moral rights championed by the European continent. See the section Droits Morals below. For more about the merger doctrine, see Morrissey v. Procter & Gamble Company, 379 F.2d 675 (1st Cir. 1967), and Kregos v. Associated Press, 937 F.2d 700 (2d Cir. 1991). 17 U.S.C. § 106 Copyright Act. 17 U.S.C. § 201(d). The proposed UCC Article 2B/UCITA is threatening to undermine “first sale” and “fair use.” Article 2B provides a contractual framework for controlling certain kinds of information and services. The worry is that “shrink wrap,” “click wrap,” and similar licensing arrangements will allow rights holders to circumvent the free use zones of “first sale” and “fair use.” See Amy M. Harris, “The Proposed UCC Article 2B,” Intellectual Property Update (1998): 5; and Robert L. Oakley, “UCC Article 2B: Some Preliminary Comments on a New Issue for the Library Community.” Presented at the Annual Meeting of the Association of Research Libraries, October 16, 1997. Some version of Article 2B is expected to be adopted by July of 1999 and then presented to each state for consideration. See 17 U.S.C. § 109(a). S. Halpern, D. Shipley, H. Abrams, Copyright: Cases And Materials (St. Paul, MN: West Publishing, 1992), 216. The limited term of copyright, and patent as well, is required by the Constitution. Article I, Section 8 empowers Congress to “promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries” (emphases mine). Patent Act, 35 U.S.C. § 101 (1988). The 1995 version of the Patent Act has added three years to the term of patent protection—from seventeen to twenty. See 35 U.S.C. § 154(a)(2).

The Domain of Intellectual Property

35

47. 48.

35 U.S.C. § 101 (1988). 35 U.S.C. § 101-104 (1988). See also Christie v. Seybold, 55 Fed. 69 (6th Cir. 1893) and Hull v. Davenport, 24 C.C.P.A. 1194, 90 F.2d 103, 33 USPQ 506 (1937).

49. 50.

35 U.S.C § 101-104 (1988). See Christie v. Seybold (United States Court of Appeals, Sixth Circuit, 1893), Hull v. Davenport (United States Court of Customs and Patent Appeals, 1937), and Kimberly-Clark corp. v. Procter & Gamble Distributing Co., Inc. (United States Court of Appeals, Federal Circuit, 1992). See 35 U.S.C. sec 103. See also Ryko Manufacturing Co. v. Nu-star, Inc., 950 F.2d 714 (Fed. Cir. 1991, Environmental Designs, LTD. v. Union Oil Company of California, 713 F.2d 693 (Fed. Cir. 1983), ACS Hospital Systems, Inc. v. Montefiore Hospital, 732 F.2d 1572 (Fed. Cir. 1984), and In Re Oetiker, 977 F.2d 1443 (Fed. Cir. 1992). 35 U.S.C. § 154 (1984 and Supp. 1989). In chapter 7 I argue that this rule should be eliminated. The Restatement (Third) of Unfair Competition, § 39 (1995). See Forest Laboratories, Inc. v. Pillsbury Co., 452 F.2d 621 (7th Cir. 1971), and E.I. duPont deNemours & Co., Inc. v. Christopher, 431 F.2d 1012 (5th Cir. 1970). 15 U.S.C. § 1127 (1988). 15 U.S.C. § 1174 (1988). Throughout this section I follow M. Epstein’s Modern Intellectual Property, 2nd ed. (Englewood Cliffs, NJ: Prentice Hall Law and Business, 1992), 259-88. Buchwald v. Paramount Pictures, 13 U.S.P.Q. 2d 1497 (Cal. Super. Ct. 1990). See Murry v. National Broadcasting, 844 U.S. F2d 988 (Second Cir. 1988) (“[N]onnovel ideas are not protectable as property...”), Davies v. Carnation Co. (9th Cir. 1965) (“A mere idea without novelty is not a property right to which one may claim exclusive ownership”), Puente v. President and Follows of Harvard College (1st Cir. 1957), and Hamilton Nat’l Bank v. Belt (D.C. Cir. 1953). See Hamilton Nat’l Bank v. Belt (D.C. Cir. 1953). (“In addition to being new, novel or original, an idea to be legally protected must also be concrete. The law shies away from according protection to vagueness”) and O’Brian v. RKO Radio Pictures Inc. (“It is well-settled law that an author has no property rights in his ideas unless the same are given embodiment in a tangible form”). See Sellers v. American Broadcasting Co. (11th Cir. 1982) and McGhan v. Ebersol (1985) (“A plaintiff cannot recover for misappropriation of ideas unless the ideas are actually used by a defendant”). Obviously, within the Anglo-American tradition there are number of exceptions to the subject matter, rights, and limitations found in these tables. For example, a corporation may receive a patent on a nuclear devise but not obtain a right use the device. For a more precise account of the rights conferred on property holders within each system, please see the relevant statute or code along with Hohfield and Honoré’s analysis of rights. Adapted from W. Borchard, “A Trademark is not a Patent or a Copyright,” USTA Executive Newsletter No. 39 (1986), 186. Although it is possible to obtain a copyright and trade secret for the same expression, it is not possible to obtain a patent and a trade secret in the same intellectual property. Patent law requires disclosure which would run up against the secrecy requirement for trade secrets.

51.

52. 53. 54. 55. 56. 57. 58. 59. 60.

61.

62. 63.

64. 65.

36 66. 67. 68. 69.

70. 71. 72.

73. 74.

75. 76. 77. 78. 79.

80. 81. 82.

Intellectual Property and Information Control 35 U.S.C. § 101 (1988). 35 U.S.C. § 271 (1988). 35 U.S.C. § 154 (1988). Generally these moral rights have not been recognized within the Anglo-American tradition. See Crimi v. Rutgers Presbyterian Church, 194 Misc. 570 (N.Y.S. 1949). Recently, given the inclusion of the United States in the Berne Convention treaty, there has been a move toward indirect recognition. See Gilliam v. American Broadcasting Companies, Inc., 538 F. 2d 14 (2d Cir. 1976), Wojnarowicz v. American Family Association, 745 F. Supp. 130 (S.D.N.Y. 1990), and the Berne Convention Implementation Act of 1988. See also 17 U.S.C. § 106A (1998) Rights of certain authors to attribution and integrity. Roeder, “The Doctrine of Moral Right: A Study in the Law of Artists, Authors and Creators,” Harvard Law Review 53 (1940): 554. Anglo-American systems of intellectual property are justified along rule-utilitarian lines. See chapter 3. Foreshadowing things to come—the rule-utilitarian typically argues in the following way. Society ought to adopt a system or institution if it leads to the maximization of overall social utility. A system or institution that confers limited rights to authors and inventors over what they produce is necessary for the production of intellectual works. Promoting the creation and dissemination of intellectual works is necessary (or nearly so) for an optimal amount of social progress. It follows that a system of intellectual property should be adopted. It will be argued in chapter 3 that ruleutilitarian attempts to justify Anglo-American systems of intellectual property protection fail—i.e., if intellectual property rights are to be defended they will have to be defended on different grounds. After providing a Lockean justification for intellectual property in chapters 4-6, I will return to these issues in chapter 7. Please note the generality here. It is intentional given that I am offered a working definition of intellectual property that will range across all of the types canvassed above—including trade secrets, the law of ideas, and the moral rights of authors and inventors recognized in Europe. Restatement of Torts § 757. Restatement of Torts § 757. 35 U.S.C § 101 (1988). 35 U.S.C. § 271 (1988). It has been suggested to me that the type-token distinction is ‘messy’ because intellectual property protection is really about ideas and their reduction to practice (patents) or ideas and their expressions (copyrights). This, however, simply begs the question against trade secrets, the law of ideas, and the moral rights recognized in Europe. I acknowledge that protecting ideas or types will require the control of physical goods or tokens and that there many different levels of control. Thus, you may be able to think about some set of ideas yet be prohibited from broadcasting them. For more about the actual application of the substantial similarity test, see Computer Assocs. Int’l v. Altai, Inc. 2nd Cir. 1992 and Herbert Rosenthal Jewelry Corp. v. Kalpakian (9th Cir. 1971). See Murry v. Paramount Pictures (Cal. Super. Ct. 1990). The differences between Anglo-American and French systems of copyright largely stem from how the systems are justified. See “A Tale of Two Copyrights: Literary Property in Revolutionary France and America” in Of Authors and Origins, edited by B. Sherman and A. Strowel (Oxford: Clarendon Press, 1994).

3 Against Rule-Utilitarian Intellectual Property “No one can doubt, that the convention for the distinction of property, and for the stability of possession, is of all circumstances the most necessary to the establishment of human society, and that after the agreement for the fixing and observing of this rule, there remains little or nothing to be done towards settling a perfect harmony and concord.” —David Hume, Treatise of Human Nature

Introduction Anglo-American systems of intellectual property are typically justified on utilitarian grounds. Limited rights are granted to authors and inventors of intellectual property “to promote the progress of science and the useful arts.”1 Beginning with the first Patent Act of 1790 and continuing through the adoption of Berne Convention standards in 1989, the basis given for Anglo-American systems of intellectual property is utilitarian in nature and not grounded in the natural rights of the author or inventor. Thomas Jefferson, a central figure in the formation of American systems of intellectual property, expressly rejected any natural rights foundation for granting control to authors and inventors over their intellectual work. “The patent monopoly was not designed to secure the inventor his natural right in his discoveries. Rather, it was a reward, and inducement, to bring forth new knowledge.”2 Society seeks to maximize utility in the form of scientific and cultural progress by granting rights to authors and inventors as an incentive toward such progress. This approach is, in a way, paradoxical. In order to enlarge the public domain permanently, society protects certain private domains temporarily. In general, patents, copyrights, and trade secrets are devices, created by statute, to prevent the diffusion of information before the author or inventor has recovered profit adequate to induce such investment. 37

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This view is echoed by the committee report that accompanied the 1909 Copyright Act: In enacting a copyright law Congress must consider . . . two questions: First, how much will the legislation stimulate the producer and so benefit the public, and, second, how much will the monopoly granted be detrimental to the public? The granting of such exclusive rights, under the proper terms and conditions, confers a benefit upon the public that outweighs the evils of the temporary monopoly.3

The justification typically given for Anglo-American systems of intellectual property “is that by slowing down the diffusion of information . . . it ensures that there will be more information to diffuse.”4 Moreover, utilitarian-based justifications of intellectual property are elegantly simple. Control is granted to authors and inventors of intellectual property because granting such control provides incentives necessary for social progress. Coupled with the theoretical claim that society ought to maximize social utility, we arrive at a simple yet powerful argument.5 In this chapter I will examine the rule-utilitarian approach to justifying systems of intellectual property protection. Along with a brief explanation of utilitarian moral theory, the first part will consist of an analysis and dismissal of two of the most widely supported ruleutilitarian justifications for intellectual property. It will be argued that internally, on its own grounds, rule-utilitarianism fails to justify the Anglo-American systems of patent, copyright, trade secret, and trademark. Note that this internal attack, if successful, will only present a problem for those rule utilitarians who want to justify the present system. The second part of this chapter will consist of an external examination and rejection of rule-utilitarian moral theory. Thus, if the internal or the external critique is successful, then the rule-utilitarian approach for justifying current systems of intellectual property protection will be eliminated as a plausible contender and the way will be cleared for alternative justifications. A General Overview of Utilitarian Theory6 “Utilitarianism” is not a single theory, but rather a cluster of theories that center around the following three components: i.

the consequent component—the rightness of actions is determined by the consequences;

ii.

the value component—the goodness or badness of consequences is to be evaluated by means of some standard of intrinsic value;

Against Rule-Utilitarian Intellectual Property iii.

39

the range component—it is the consequences of an act (or class of actions) as affecting everyone, and not just the agent himself, that are to be considered in determining rightness.

This way of characterizing utilitarianism is purposefully ambiguous between act-utilitarianism and rule-utilitarianism depending on the notion of “action” used in (i) and (iii). I begin this way, because I don’t want to beg any questions as to the exact type of utilitarianism that justifies Anglo-American systems of intellectual property. Act-utilitarianism is a theory which holds that an individual act is morally right if, and only if, it produces at least as much utility as any alternative action when the utility of all is counted equally. For example, classical act-utilitarianism is the view that individual acts are right or wrong solely in virtue of the goodness or badness of their consequences. The value component is identified in terms of pleasure and pain and the range or scope of the theory touches everyone affected by an act. Modern utilitarians have generally rejected the crude hedonistic account of value in favor of an interest satisfaction view. For our purposes, a precise utilitarian account of value will not be needed and thus “utility” will be used as a blanket term to stand for that which is intrinsically good. Act-utilitarians view rules that govern behavior as mere rules of thumb7 that serve as helpful guides when there is no time to calculate the probable consequences of our actions or when personal biases cloud judgment.8 The rightness or wrongness of following some rule on a particular occasion depends only on the goodness or badness of the consequences of keeping or breaking the rule on that particular occasion. If the goodness of the consequences of breaking the rule is greater than the goodness of the consequences of keeping it, then we must abandon the rule. On this view, rules may serve as useful guides but when it is clear that following them leads to bad consequences, then we must break the rule. If granting an author or inventor limited rights over what she produce maximizes net utility for everyone affected by the act, then intellectual property rights have been justified on act-utilitarian grounds. But it should be obvious that this is not an accurate model of how intellectual property rights are justified within Anglo-American systems. Individual acts of conferring rights to each author and inventor are not tested to see if they will maximize overall expected

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utility for everyone affected. Moreover, the rules that comprise AngloAmerican systems of intellectual property are not taken as mere rules of thumb. Even in cases where it is known beforehand that conferring rights to an inventor will lead to bad consequences, intellectual property rights are granted nonetheless. This point is echoed by J. Robinson: Since it is rooted in a contradiction (long term benefits verses short term incentives), there can be no such thing as an ideally beneficial patent system, and it is bound to produce negative results in particular instances, impeding progress unnecessarily even if its general effect is favorable on balance.9

It is for these reasons and others that, in terms of the justification typically given, Anglo-American systems of intellectual property are rule-utilitarian in nature. Rule-utilitarians hold that moral rules are more than just rules of thumb that are to be broken when following them produces less utility than some other act. For the rule-utilitarian, the rightness of an act is not to be judged by comparing its consequences to the consequences of alternative acts, but only by considering whether or not it falls under a correct moral rule. Rules themselves are judged by considering the consequences of everyone following the rule.10 If adopting a rule, set of rules, or institution maximizes net utility for everyone affected, then the rule, set of rules, or institution is morally justified. Generally, actions are to be judged in reference to rules and rules in reference to the consequences. The only time particular acts are tested directly is when there is no rule which covers the act or when two rules conflict. In terms of “justification,” modern Anglo-American systems of intellectual property are easily modeled as rule-utilitarian.11 Typically, it is argued that adopting the systems of copyright, patent, trademark, trade secret, and the law of ideas, leads to an optimal amount of intellectual works being produced and a corresponding optimal amount of social utility. These systems or institutions are not comprised by mere rules of thumb. In particular cases, conferring rights to authors and inventors over their intellectual products may lead to bad consequences. Justification, in terms of social progress, occurs at the level of the system or institution. B. Robinson (1890) concludes that the institution of patent protection is fully justified because, in general, adopting such a system leads to good consequences for society as a whole:

Against Rule-Utilitarian Intellectual Property

41

The granting of a patent privilege at once accomplishes three important objects; it rewards the inventor for his skill and labor; it stimulates him, as well as others, to still further efforts in the same or different fields; it secures to the public an immediate knowledge of the character and scope of the invention. Each of these objects, with its consequences, is a public good, and tends directly to the advancement of the useful arts and sciences.12

What follows is an explication of two of the most plausible ruleutilitarian “justifications” offered for intellectual property and a dismissal of each in turn. Criticisms will be leveled in a somewhat general way so that neighboring theories to the ones presented will fall prey as well.13 The claim is that rule-utilitarian justifications of intellectual property fail. I will go on in later chapters to defend a Lockeanbased justification of intellectual property, but this does not entail that there are no other ways to justify intellectual property rights. The Internal Critique—The Incentives Argument Given that intellectual works can be held by everyone at the same time, cannot be used up or easily destroyed, and are necessary for many lifelong goals and projects, it would seem that we have a prima facie case against regimes of intellectual property that would restrict such maximal use. Tangible property, including concrete expressions of intellectual works, is subject to exclusive physical domination in a way that intellectual or intangible property is not. Smith’s use of a car excludes my concurrent use, whereas his use of a theory, process of manufacture, or recipe for success, does not. Thus intellectual works can be seen as non-rivalrous commodities.14 If this is true, we have an immediate prima facie case against rule-utilitarian justifications of intellectual property rights. The rejoinder, typically given, is that granting rights to use, possession, and control of both ideas and expressions of ideas is necessary as incentive for the production of an optimal amount of intellectual works. Ideas themselves may be independently valuable but when use, possession (in some cases), and control are restricted in a free market environment, the value of certain ideas increases dramatically. Moreover, with increased value comes increased incentives, or so it is argued. On this view, a necessary condition for promoting the creation of valuable intellectual works is granting limited rights to authors and inventors. “Without the copyright, patent, and trade secret property

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protections, adequate incentives for the creation of a socially optimal output of intellectual products would not exist.”15 The claim is that without certain guarantees, authors and inventors would not engage in producing intellectual property. Although success is not guaranteed by granting rights, failure certainly is, if others who incur no investment costs can seize and produce the intellectual effort of others. Generally, under conditions of no protection, it would be in a company’s interest to let others create products and then merely reverse engineer the product, thereby forgoing investment and research costs. In this case, social progress slows and overall social utility suffers. Many rule-utilitarians argue that private ownership of physical goods is justified because of the tragedy of the commons or problems with efficiency. Systems of private property are more efficient, or so it is argued, than systems of common ownership. It should be clear that this way of arguing is based on providing incentives. Owners of physical goods are given an incentive to maintain or increase the value of those goods, because the costs of waste, and the like, are internalized. It is commonly argued that in the case of physical goods, granting rights generates incentives to efficiently use those goods, and this policy thereby optimizes social utility. The incentives-based, rule-utilitarian argument for systems of intellectual property protection is very similar. In this case, rights are granted as incentive for the production of intellectual works, and rule-utilitarians argue that production of this sort, in turn, maximizes social utility. It is important to note, that on this view, rights are granted to authors and inventors, not because they deserve such rights or have some natural right to their creations, but because this is the only way to ensure that a optimal amount of intellectual products will be available for society.16 A more formal way to characterize this argument is, P1. Society ought to adopt a system or institution if and only if it leads to or, given our best estimates, is expected to lead to the maximization of overall social utility.17 P2. A system or institution that confers limited rights to authors and inventors over what they produce is expected to serve as incentive for the production of intellectual works. P3. Promoting the creation and dissemination of intellectual works produces an optimal amount of social progress. Therefore, C4. A system of intellectual property should be adopted.

Against Rule-Utilitarian Intellectual Property

43

The first premise—or the theoretical premise—is supported by rule-utilitarian arguments that link theories of the good and theories of the right in a particular way. For the rule-utilitarian, a correct moral rule is determined in reference to the consequences of everyone adopting it. By following a rule-based component it is argued that the problems that face act-utilitarianism—problems of justice,18 special obligations,19 integrity,20 and excessive demands21—are circumvented. Moreover, by grounding the theory solely in a consequent component, unlike deontic theories, rule-utilitarians argue that the theory is given firm footing. In combining the most promising aspect of act-utilitarianism (consequences are all that matter) with the most promising aspect of deontology (its rule following component), rule-utilitarians hope to arrive at a defensible moral theory. The second premise, P2, is an empirical claim supported by the aforementioned considerations concerning incentives. The view is that it is an empirical fact that authors and inventors will not engage in the appropriate activity unless certain guarantees are in place. What keeps authors and inventors burning the midnight oil, and thereby producing an optimal amount of intellectual works, is the promise of massive profits. The third premise is supported by general arguments to the effect that cultural, technological, and industrial progress are necessary for an optimal amount of social utility.22 It follows that a system of intellectual property should be adopted. Problems for the Incentives Argument Putting aside general attacks leveled at rule-utilitarianism which will concern us in a latter section, a serious challenge may be raised by questioning the truth of the second premise (hereafter P2). It will be argued that P2 is false or at least highly contentious, and so even granting the truth of the first and third premises, the conclusion does not follow.23 Given that the truth of P2 rests on considerations of incentives, what is needed are cases which illustrate better ways, or equally good ways, of stimulating production without granting private property rights to authors and inventors. It would be better to establish equally powerful incentives for the production of intellectual property which did not also require initial restricted use. Here I am not denying that copyright and patent-based incentives work. In good consequentialist fashion, I am asking can we do better? Furthermore, I argue that even if P2 is assumed true the resulting sys-

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tem of intellectual property would be markedly different from modern Anglo-American systems of intellectual property. Note that this latter worry only affects those rule-utilitarians who want to justify the present system or closely related systems. One alternative to granting initial restricted control to authors and inventors as incentive is government support of intellectual labor.24 The cases I have in mind are ones where the government funds research projects and the results immediately become public property. It is obvious that this sort of funding can and does stimulate the production of intellectual property without allowing initial restricted control to authors and inventors. The question becomes can government support of intellectual labor provide enough incentive to authors and inventors so that an equal or greater amount of intellectual products are created compared to what is produced through incentives created by conferring limited property rights?25 If so, then P2 is false and intellectual property rights should not be granted on grounds of utility.26 In response to this kind of charge, defenders of the argument based on incentives have claimed that government support of intellectual labor does not and will not create the requisite incentives. It is only by holding out the promise of huge profits that society obtains maximal progress for all. Governments may be able to provide some incentives by paying authors and inventors in advance, but this kind of activity will never approach the incentive created by adopting a system that affords limited monopoly rights to intellectual property. Another reply typically given is the standard utilitarian argument against centralized planning. Governments are notoriously bad in the areas of predicting the demand of future markets, research and development, resource allocation, and the like. Maximizing social utility in terms of optimizing the production of intellectual works is best left in the hands of individuals, businesses, and corporations. The problem with these kinds of replies is that they are misleading. Certainly the promise of huge profits is part of what drives authors and inventors to burn the midnight oil, but the promise need not be guaranteed by ownership. Fritz Machlup, in Production and Distribution of Knowledge in the United States, argues that patent protection is not needed as incentive for corporations, in a competitive market, to invest in the development of new products and processes. “The short-term advantage a company gets from developing

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a new product and being the first to put it on the market may be incentive enough.”27 Consider, for example, the initial profits generated by the sales of certain software packages. The market share guaranteed by initial sales, support services, and the like, may provide adequate incentives without granting governmental protection. Moreover, given the development of advanced copy-protection schemes, software companies can protect their investments and potential profits for a number of years. Sidney Winter’s more recent research supports this view. “In our book, Nelson and I present a simulation study of innovation in an industry model; the results suggest rather strongly that unimpeded imitation need not yield inferior results from a social standpoint.”28 Jack Hirshleifer uses Eli Whitney’s invention of the cotton gin as an example of how non-rights based incentives are available.29 Suppose Whitney, armed with the knowledge of a superior method of processing cotton, invested in cotton producing. Whitney could buy stock in cotton-based companies as well as businesses that benefited from the cotton industry. Profiting on the use of this information may be all the incentive that Whitney needed to invent. If this is so, granting property rights to inventors may entail overall costs in utility rather than net gains. Machlup also suggests that large corporations (who own the majority of patents) can, in some cases, hinder general technological progress by controlling entire industries. An obvious example would be Microsoft’s control of computer operating systems. Microsoft has captured approximately 60 to 80 percent of the world market and has patented and copyrighted its operating systems. Any software company that wants to produce a product must first obtain licensing agreements with Microsoft and construct new software so that it runs on top of the Microsoft platform. It has been argued that granting such patents and copyrights, in effect, allows Microsoft to maintain a stranglehold on the market. This in turn has a detrimental effect on social progress. Moreover, in some cases, “[T]he patent position of the big firms makes it almost impossible for new firms to enter the industry.”30 Alas, if the groundwork of a certain technology is patented, then the company that owns the patent may control who enters the market. Potential worthy competitors are not granted licensing agreements and are thus prohibited from competing in a particular area. If

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Machlup’s empirical observations are correct, then patent protection cannot be justified in this way.31 Machlup is actually undecided about the costs and benefits associated with patent institutions. “Such net effects are impossible to estimate, because they presuppose answers to unanswerable questions: How many inventions would not be made and developed if no promises were given that the inventor or his assignee or licensee would be protected against competition from imitators? How much output is not produced when competitors are not allowed to use the superior production processes or to make and sell the novel products protected by patents? Both the benefits society stands to gain and the losses it stands to suffer can be appraised only by comparing actual with fictitious situations, with no clues, let alone evidence, available for such comparisons.”32 This seems to me to be overstating things a bit. What good rule-utilitarians ought to do is to make their best guess given the information available and then adopt the institution that will most likely maximize utility. This might require tinkering with the current system, for example, a study could be done that tests the costs and benefits of having mere anti-piracy protection for software. Moreover, if the jury is out, so-to-speak, then the rule-utilitarian can hardly appeal to the known or likely benefits of the patent system for justification. Trade secret falls prey to similar objections. Given that no disclosure is necessary for trade secret protection, there are no beneficial trade-offs between promoting behavior through incentives and long term social benefit.33 From a rule-utilitarian point of view the most promising aspect of allowing intellectual property rights is the widespread dissemination of information and the resulting increase in social progress. Trade secret protection allows authors and inventors the right to slow the dissemination of protected information indefinitely—a trade secret requires secrecy.34 Unlike other regimes of intellectual property, trade secret rights are perpetual. This means that so long as the property holder adheres to certain restrictions, the idea, invention, product, or process of manufacture may never become common property.35 The truth of P2 is also in doubt when considering certain kinds of Anglo-American copyright protection. Many authors, poets, musicians, and other artists would continue to create works of intellectual worth without proprietary rights being granted. A number of

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musicians, craftsman, poets, and the like simply enjoy the creative process and need no other incentive to produce intellectual works. For example, a musician friend of mine creates and performs songs simply for the joy of creation, prestige, and community support. Conversely, though, it may be argued that the production of many movies, plays, and television shows is intimately tied to the limited rights conferred on those who produce these expressions. But this kind of reply is subject to the same problem that befell patent protection. The short-term advantage a production company gets from creating a new product and being the first to market, coupled with copy-protection schemes, may be incentive enough. And even if the production of movies is more dependent on copyright protection than academic writing or poetry readings, all that can be concluded is that incentives may be needed for the optimal production of the former but not the latter.36 The system or institution that distinguishes between these kinds of expressions and only granted rights where incentives are necessary would be better, on rule-utilitarian grounds, than our current system. This kind of problem represents a general objection to rule-utilitarianism that will be explored in a later section. 37 If these observations reach beyond the scope of patent, copyright, and trade secret protection to other forms of intellectual property, the general falsity of P2 will have been established. The upshot is that if P2 is false we will have found that the incentives-based, rule-utilitarian argument, far from justifying intellectual property rights, actually becomes an argument against allowing the rights guaranteed by Anglo-American systems of intellectual property protection. Notice that incentives-based, rule-utilitarian argument for intellectual property protection becomes even more strained when viewed from a global perspective. It is an open question as to whether or not these systems of property are beneficial in the long run when compared to the immediate needs of developing countries. With no conclusive evidence to decide the issue either way (following Machlup), it would seem that the rule-utilitarian would have to take seriously the benefits that would occur with an immediate transfer of information and technology from developed countries to developing countries.38 But suppose for the sake of argument that these charges can be answered. Even granting the truth of P2, it seems that the incentives-

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based argument would lead to a radically different system of intellectual property than is currently exhibited by modern Anglo-American systems. The claim is that society could provide the necessary incentives without granting such robust rights to authors and inventors. If conferring a more limited set of rights would lead to an equal or greater amount of worthwhile intellectual products, then the dissemination of information may be increased and overall social utility augmented. And if Machlup’s and Winter’s observations are even partially correct, this seems obviously the case. Granting exclusive twenty-year patent monopolies is not necessary as incentive to get companies to produce an optimal amount of intellectual products. In most industries a five-year non-exclusive monopoly may provide the necessary incentives.39 Similarly, copyright protection need not extend past the lifetime of the author. It can be argued that novels, movies, music, and other works of art would still be produced in equal amounts with more limited incentives. The justification typically given for the “fair use” rule is that limiting the rights of authors in this way causes no decrease in incentives to produce. My suggestion is that more limitations could be justified in this way—maybe all that is needed is a prohibition against piracy and bootlegging.40 Furthermore, is seems that far from justifying the regime of trade secret protection, the incentives-based (trade-off) argument would require its elimination. As noted before, so long as holders of trade secrets adhere to certain restrictions they never have to divulge the information to the public, and so there is no trade-off of short-term property protection for long-term social progress. Needless to say, even if the incentives argument is correct, the resulting system or institution would be quite different from modern Anglo-American systems of intellectual property.41 In response, my critic may charge that a system with too many exceptions will be unworkable. If this is true, such a system could not be defended by a rule utilitarian. But our system is fairly unworkable currently—a brief review of the relevant sections of chapter 2 and current case law would indicate this. Many of the issues are so murky some companies merely work out deals rather than litigate. Company A accuses company B of intellectual property infringement. B makes several counter claims against A. Rather than litigate, A and B work out a deal and drop all infringement claims.42 This could be a way in which the system “works” although it is

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doubtful, given that large companies are generally benefited—if B is a small company with few patents, then the counter infringement claims will be hollow at best. Moreover, I do not think that it is beyond the conceptual ability of judges and attorneys to distinguish between pharmaceutical products and movies or computer software. Considering each intellectual work on a case by case basis to determine the optimal package of rights and limitations offered is clearly unworkable. This is not my suggestion. The evidence noted above indicates that it may be possible to offer fewer rights while maintaining the current level of incentives. If so, then we are giving away too much to authors and inventors and modifications are in order. To summarize, my general position against the incentives-based argument is that institutions of intellectual property are not necessary as incentive for the production of intellectual works, and even if some system is necessary, the argument still fails to justify anything remotely close to Anglo-American systems of intellectual property. Both of these points can be considered part of an internal critique of the incentives-based, rule-utilitarian argument. Although I will now move on to present and critique (internally) a second ruleutilitarian argument for intellectual property, I will return in a later section to give an external critique of rule-utilitarian moral theory. The general attack against rule-utilitarianism is given at the end, because it applies to the theoretical components of both arguments presented. A Traditional Rule-Utilitarian Argument Lawrence Becker examines a second rule-utilitarian argument for property rights and concludes that the argument is, in part, successful. Although Becker’s reconstruction of the argument is aimed at justifying rights to tangible property, with minor modifications it can be used to justify a system or institution of intellectual property. In general, the claim is that a system or institution of intellectual property is a necessary means for human flourishing and well-being. Hume reminds us in the quote that prefaces this chapter that stability of possession and the distinction of property are necessary for the establishment of society. Coupled with the assumption that the formation and long-term establishment of a stable, secure society is a requirement of human well-being, we arrive at a simple, and seem-

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ingly powerful, argument for institutions or systems of intellectual property protection. Consider a more formal version of this argument: 43 1.

Society ought to adopt a system or institution if and only if it leads to or, given our best estimates, will lead to the maximization of overall social utility.

2.

Some institutions are necessary for the achievement of human flourishing and well-being and these institutions are determined by an examination of the social conditions which are required for human well-being, but which cannot exist without rule-governed institutions.

3.

How those necessary institutions are to be defined is to be determined by how well the rules constitutive of their various possible definitions, when applied to cases, meet the demands which make the institution necessary.

4.

People need individually to possess, use, and control intellectual works in order to achieve (the means to) a reasonable degree of well-being.

5.

Security in possession and use of intellectual property is impossible (given society as we know it) unless enforced modes of acquisition are controlled. Such enforcement amounts to the administration of a system of intellectual property rights.

6.

It follows that a system of intellectual property rights is necessary (or nearly so) if individuals are to achieve (the means to) even a reasonable degree of wellbeing and ought to be adopted.

As with the incentives-based argument, the first premise of the traditional argument is supported by rule-utilitarian arguments that link theories of the good and theories of the right in a particular way. There are many arguments used to establish the truth of the second premise, that some social institutions are necessary in order to achieve a reasonable degree of human well-being. One such argument, offered by David Hume, is given the “numberless wants and necessities” that humans have, and the “slender means” nature has provided for the satisfactions of these wants and necessities, certain social institutions are needed: By the conjunction of forces, our power is augmented: by the partition of empolyments, our ability increases. And by the mutual succour we are less expos’d to fortune and accidents. ’Tis by this additional force, ability, and security, that society becomes advantageous.44

Stable systems or institutions that decide property relations, legal and illegal behavior, societal obligations, and the like, all seem pre-

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requisites for human flourishing and well-being. As rational lifelong project pursuers, humans need certain stable systems or institutions that allow such behavior. Hume argues along similar lines claiming that “the internal satisfaction of our minds, the external advantages of our body, and the enjoyment of such possessions as we have acquir’d by our industry and good fortune” are three kinds of goods that are necessary for human well-being. The chief advantage of society is the improvement of these goods and, therefore, the institutions that create, maintain, and stabilize society would seem necessary. All things considered, the second premise seems fairly uncontroversial. The third premise, the definition of the necessary institutions, provides a way to determine which institutions are necessary and what rules or practices should make up those necessary institutions. “[t]he particular character of a necessary institution must itself be submitted to the test of utility. If property is found to be necessary, then questions will arise not only about the various ways of defining and limiting the scope of the incidents of ‘full or liberal ownership,’ but about including each of the incidents at all.”45 If the argument is to do any work it must indicate which institutions are necessary for human flourishing and which set of rules will constitute those institutions deemed necessary. The fourth premise, the claim that people need individually to acquire, possess, and use intellectual products in order to achieve a reasonable degree of well-being may be defended the following way. As rational lifelong project pursuers, humans need to use and possess things, including intellectual property. Many purposeful activities require the use of both physical goods and intellectual products. To the extent that these items are unavailable or unsecure, humans are frustrated in their pursuits; and finally, frustration of this sort diminishes overall social utility.46 Premise five is typically justified on empirical grounds. Given humans as they are, and as they have been, certain coercive institutions are necessary for security of possession and use of intellectual products. This seems obviously the case when considering institutions of intellectual property. Given the ease of theft and the prevailing attitudes concerning intellectual property, it seems plausible to maintain that coercive institutions are necessary. It follows that a system of intellectual property rights is necessary, or nearly so, if individuals are to achieve the means to a reasonable

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degree of well-being and ought to be adopted. The specific rules that constitute each regime of intellectual property will be determined in reference to overall social progress; and, if premise four is correct, each of these regimes will include limited rights to use, possess, and control intellectual works. Problems for the Traditional Rule-Utilitarian Approach Consider, once again, the prima facie case against allowing the ownership of intellectual works. Given that intellectual works can be held by everyone at the same time, cannot be used up or easily destroyed, and are necessary for many lifelong goals and projects, it would seem that we have a prima facie case against regimes of intellectual property that would restrict such maximal use. As noted before, the rejoinder is that granting rights to use, possession, and control of both ideas and expressions of ideas is necessary as incentive for the production of an optimal amount of intellectual works. But this takes us back into the incentives-based argument that has been shown to be problematic at best. It would seem then, that premise two in the traditional argument would not likely pick out systems or institutions of intellectual property protection as best promoting human flourishing. A second problem, one that arises in relation to premise three, is that the resulting systems of intellectual property would be radically different than current regimes. If conferring a more limited set of rights would lead to an equal or greater amount of worthwhile intellectual products, then the dissemination of information may be increased and overall social utility augmented. As noted before in the incentives argument, granting exclusive twenty-year patent monopolies is not necessary as incentive to get companies to produce an optimal amount of intellectual products. Copyright protection need not extend past the lifetime of the author. The regime of trade secret protection could be eliminated or severely limited with no loss in overall social utility. So even if true, the third premise would most likely support institutions of intellectual property protection that are much less robust than current Anglo-American systems. Thirdly, in order to justify intellectual property rights, premise four must be modified in such a way that it becomes implausible. As it stands, premise four states that people need individually to possess, use, and control intellectual products in order to achieve a rea-

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sonable degree of well-being. But this claim may well be true with no exclusive rights to intellectual property being granted. Given the non-exclusive nature of intellectual works it is possible for everyone to concurrently possess, use, and control (non-exclusively) the same intellectual work. To justify anything akin to intellectual property rights, the premise must be recast to include an exclusivity or semi-exclusivity component. People need individually to possess, use, and control intellectual products exclusively or semi-exclusively in order to achieve a reasonable degree of well-being. But surely this will not do either because exclusivity need not be guaranteed by legal rights. Keeping one’s ideas a secret is one way to ensure exclusivity that does not depend on government protection. Finally, if we recast the premise to include that exclusivity or semi-exclusivity is to be guaranteed by rights, then the latter formulation seems wildly implausible.47 Finally, there are various utility based anti-property arguments that if sound would call for the elimination of current institutions of intellectual property. Consider the following argument:48 Systems of intellectual property rights which permit private ownership of the means of production and exclusive monopolization of intellectual works inevitably produce inequality in wealth of a sort that increases over generations, hardens the social order into classes, and leads to an unjustifiable amount of poverty and social instability. It is not necessary to permit exclusive or semi-exclusive ownership of intellectual works given that these items are not necessary for survival or the full development of personality. And finally, since it is not obvious that people need to exclusively control intellectual works, and allowing such control leads to poverty and social instability, we should not adopt such institutions. If successful, such an argument undermines premise three in defining institutions of intellectual property as necessary or utility maximizing.49 Becker criticizes this argument on the grounds that there is no way to accurately determine the empirical claim that certain kinds of property institutions lead to poverty and instability: But whether the institution of property rights always must produce poverty and social instability just seems to me to be beyond anyone’s power to determine. One can, after all, imagine circumstances in which it would not, and those circumstances are not all utopian fantasies.50

Becker admits that this is indeed how things have often turned out, but thinks that such an admonition is far from granting the claim

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that the one necessarily leads to the other. But surely this misses the point. If property theorists can summon historical empirical facts to support their claims that adopting systems of intellectual property will likely maximize general utility, then the door has been opened for the anti-property theorist to appeal to similar historical facts. The anti-property theorist does not need to claim that institutions of intellectual property will necessarily lead to poverty and instability, only that they likely will. Moreover, we do not require that the ruleutilitarian property theorist show that institutions of intellectual property will necessarily lead to an optimal amount of social progress, so it is presumptuous to require the anti-property theorist to show instability and poverty follows of necessity. Digitized Intellectual Works—A Final Worry A basic rule of rule-utilitarian copyright and patent law is that while ideas themselves cannot be owned, the physical or tangible expressions of them can.51 Ideas, as well as natural laws and the like, are considered to be the collective property of humanity.52 It is commonly assumed that allowing authors and inventors rights to control mere ideas would diminish overall social utility and so an idea/expression distinction has been adopted. But digital technology and virtual environments are detaching intellectual works from physical expression. The “bit streams” that inhabit the World Wide Web seem to be much less tangible than paper and ink or machines and processes of manufacture. This tension between protecting physical expressions and the status of online intellectual works leads to a deeper problem. Current Anglo-American institutions of intellectual property are constructed to protect the efforts of authors and inventors and, at the same time, to disseminate information as widely as possible. But when intellectual works are placed online there is no simple method of securing both protection and widespread access. Once I have access to a work that is placed online, I can download it or send copies to my friends. Note also, that in a networked world it is possible for artists, who produce for fun rather than profit, to reach a worldwide audience. Thus information may be distributed independent of a publishing industry driven by incentives and profits. As this kind of distribution increases, the need for incentives-based distribution models may be further undermined.53

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In light of these problems the rule-utilitarian could merely reevaluate the consequences of adhering to certain intellectual property rules and try to better the overall system. Maybe adopting an idea/expression distinction will not yield the best results, or maybe further restrictions on the rights granted to authors and inventors will increase information flow and yet still provide adequate incentives. Imagine though, that circumstances arise where granting authors and inventors limited control over what they produce is not needed as incentive for an optimal production of intellectual works. Suppose that a policy of granting rights to intellectual works diminishes overall social utility compared to not granting rights. Are those who defend rule-utilitarian intellectual property prepared to deny all rights to control intellectual works in this case? Suppose we conclude, according to our best utility calculations, that no one should be able to exclusively control any idea or collection of ideas. Imagine a world where all would be best off if everyone were required to disclose any new idea that they had—maybe appropriately placed digital cameras equipped with sensitive listening devices could capture all of this information. Suppose further that new computer technology disseminated these ideas in a logical and efficient fashion. In cases such as this, rule-utilitarians may be forced to an unsavory position. In principle their theory may advocate almost any atrocity—so long as the rules adopted yield the best long-term utility. That such a case would, in fact, never happen is beside the point. Summary of Internal Critique Before turning to an external critique of rule-utilitarian based arguments for systems of intellectual property protection, I would like to summarize the main points of the internal critique. The general position leveled against the incentives-based argument is that granting rights to authors and inventors as incentive is either giving away too much or would justify systems foreign to current Anglo-American institutions of intellectual property. The traditional rule-utilitarian argument falls prey to these problems as well, insofar as a likely defense of the second and third premise would focus on incentives. Moreover, where premise four seems true when considering tangible property, it is most likely false with respect to intellectual property.

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The External Critique54 So far, I have given an internal critique by arguing that, even on its own terms, the rule-utilitarian approach fails to justify intellectual property rights. In the remainder of this chapter, I will turn to an external critique of rule-utilitarian moral theory. The first premise of both rule-utilitarian arguments given as justification for systems of intellectual property is that society ought to adopt an institution if and only if it leads to or, given our best estimates, will lead to the maximization of overall social utility. As we shall see, this approach to moral theory is beset with difficulties. The Problem of Act Description Rule-utilitarians determine the rightness or wrongness of actions by appealing to moral rules. In general, actions are to be tested in reference to rules and rules in reference to the consequences. One problem for the rule-utilitarian is that without an adequate account of act description, the theory cannot be applied. Since the evaluation of rules is dependent on the consequences, and acts not rules have consequences, we must decide how to describe actions in order to justify rules. Consider the following example. Some action I perform may be described in a number of ways. For instance, a particular action might be described in any of the following ways: !

copying the intellectual works of another;

!

copying the intellectual works of another when no one else will;

!

copying the intellectual works of another when no one else will, and when doing so will save lives of fifty children; and,

!

copying the intellectual works of another when no one else will, and when doing so will save lives of fifty children who have been genetically engineered to grow into Hitlers and Stalins.55

Since the consequences of everyone doing actions of these different types would be very different, the rule utilitarian must give us a theory of act description before we can apply the theory. The difficulty is solving the problem in such a way that doesn’t lead ruleutilitarianism to collapse into act-utilitarianism. If we determined kinds of actions (action types) by giving a maximally specific de-

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scription of each action (action tokens), then the type will only cover one specific act and hence the collapse.56 Eric D’Arcy and David Lyons both independently develop answers to the problem of act description.57 In general their theories distinguish between acts, circumstances, and consequences. The solution that both seem to advocate is that we use moral norms to determine the relevant description of a particular act. Since utilitarians are concerned with the goodness of consequences, we should describe an act in such a way that all the relevant consequences are included. The problem with this solution is that it is circular. We need to describe acts so that we can determine moral norms but the only way to adequately determine the appropriate act description is to appeal to moral norms. Moreover, there can be no moral norms outside of the moral theory in question—it is not as if the rule utilitarian can appeal to deontological considerations to determine the appropriate act description.58 Crudely put, act descriptions are necessary to determine moral norms yet moral norms are necessary to determine appropriate act descriptions. Let us assume, however, that the rule utilitarian can give an adequate account of act description. As we shall see, there are other, possibly more serious, problems to consider. Adoption and Adherence Although the first premise of both arguments call for the adoption of certain institutions, rule-utilitarians have also defended an adherence view. On the adherence view the correctness of an institution or set or rules is dependent on the results of everyone actually conforming to the rules, whereas on the adoption view, the correctness of an institution is dependent on the results of everyone adopting, but not necessarily actually adhering to, the rules. The adoption model takes into account the possibility of misapplications of the rules as part of the consequences of adoption. The adherence model does not. There are two versions of the adherence view that have been defended by rule-utilitarians. The restricted model of adherence limits the descriptions of action types by not allowing references to the actions of others as part of the description. Restricted adherence, then, would not allow describing the act of taking another’s intellec-

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tual property as “taking another’s intellectual property when no one else will”: The intuition behind this restriction is that if you are allowed to make reference to the actions of others in describing your action, then rule-utilitarianism will allow the same kind of unfairness that act-utilitarianism will in these cases. In particular, it will allow what is called free-riding: receiving benefits from the cooperative sacrifices of others without making those sacrifices oneself.59

The second version of the adherence model is unrestricted in that, outside of the limitations required by a theory of act description in answer to the preceding problem, there are no restrictions on act descriptions. The problem with the restricted version of the adherence model is that it requires us to follow moral rules even when doing so will lead to bad results. Suppose we had a justified moral rule of the following sort: “Don’t copy or pirate the intellectual works of others.” Imagine that if everyone were to follow this rule that social utility would be maximized and wealth, peace, and prosperity would visit everyone. Suppose though, that you are a member of a community of radical communists and that no one else follows the rule. The only thing that will be accomplished by following the rule is that you will be put at a disadvantage compared to your fellows. You respect their intellectual property but they simply copy and pirate anything you produce. Even if it were true that no one else will follow the rule, the restricted version of the adherence model of ruleutilitarianism will say of an individual citizen that she has a moral obligation to do so. This leads to what some have called “rule futility” not “rule utility.” Alas, it seems in some cases that considering what actions others will perform does make a difference in terms of moral obligation. This problem can be circumvented by allowing the descriptions of actions to refer to the actions of others. When considering what the consequences of adhering to a rule would be, we are allowed to include references to the actions of others. We can now describe the action in the previous case as “not violating the intellectual property of others when everyone else will.” Given that this would be futile, it is not obligatory. The problem with this unrestricted version of the adherence model is that it looks like it will collapse into act-utilitarianism. Consider the following example given by J. J. C. Smart in “Extreme and Restricted Utilitarianism”:

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Suppose there is a rule R and that in 99% of cases the best possible results are obtained by acting in accordance with R. Then clearly R is a useful rule of thumb; if we have no time or are not impartial enough to assess the consequences of an action it is an extremely good bet that the thing to do is to act in accordance with R. But is it not monstrous to suppose that if we have worked out the consequences and if we have perfect faith in the impartiality of our calculations, and if we know that in this instance to break R will have better results than to keep it, we should nevertheless obey the rule?60

The answer to this problem cannot be to change R to include the exception because the final result of including each exception would be to collapse rule-utilitarianism into act-utilitarianism—i.e., this form of rule-utilitarianism would prescribe the same actions as act-utilitarianism. But surely, R with the exception is a better rule on consequentialist grounds than R with no exceptions. It would seem that the rule-utilitarian is forced to include the exception that makes R a better rule—and the collapse ensues.61 If this is correct, then either version of the adherence model of rule-utilitarianism is ruled out as a correct and workable moral theory. Putting adherence to rules aside, there is also the adoption model to consider. On this view, strict conformity is not required when considering the consequences of adopting a rule. Individuals may make mistakes when applying the rule and these mistakes may have bad consequences. The adoption model, but not the adherence model, allows these latter consequences to be considered when deciding the moral correctness of a rule or set of rules. The problem with the adoption model is that it makes the correctness of moral rules or sets of rules dependent on the rule following capacities of those who will adopt the rule. Consider the following case adapted from Hubin’s society of dolts example: Imagine that one lives in a society of dolts. These people are so stupid that they can’t apply rules that have any exceptions at all. Their rules must be simple statements. Suppose further that you are trying to decide if you should copy and pirate the intellectual works of another given that in doing so you will save hundreds of children from a new deadly virus. You might think this is morally permissible—that a good moral rule would treat this case as an exception to the rule “don’t copy or pirate the intellectual works of another.” But, on the adoption model, this is not so. If others adopted the rule “Don’t copy or pirate the intellectual property of another except when doing so will save the lives of hundreds of children (or lead to really bad consequences)” they would be so confused in applying it that they would pirate all kinds of intellectual property and cause a general decrease in overall utility. Therefore, the best rule to have adopted in this society of dolts is the rule, “Never copy or pirate the intellectual works of another”; and that rule prohibits your copying even when lives are at stake.

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If misapplications of a rule are to be factored in when considering the consequences of everyone adopting a rule, then the rule following capacities of individuals may play an important role in determining the correctness of moral rules. But this seems unacceptable. But why is this unacceptable? Why shouldn’t the rule following capacities play an important role in determining which moral rules are justified? The answer cannot be that this would lead to bad consequences given the assumption that in a society of dolts exceptionless rules are best. But different individuals have different rule following capacities and this leads to a problem. Suppose we introduce into Hubin’s society of dolts, one expert rule follower who correctly follows complex rules that have multiple exceptions. This individual recognizes that the rule “Never copy or pirate the intellectual works of another” is not as good as the rule “Never copy or pirate the intellectual works of another except when you can save the lives of hundreds of children.” The question now becomes, why shouldn’t the expert rule follower adopt the latter rule rather than the former? The worry becomes apparent when, in the same circumstances, one individual is morally required to do X while another individual is morally required to not do X—given our example, the average dolt is required to not steal the intellectual property of another while the expert rule follower is required to do the opposite. An odd kind of moral relativism looms. Moreover, the view that the rule following capacities of individuals are important in determining correct moral rules leads back to a conception of rules as rules of thumb or strategic rules. We follow these latter kinds of rules when we can’t be sure of our utility calculating abilities. Maybe the issue before us is too near and dear, or the consequences stretch too far into the future, or our judgment is clouded for some other reason. In cases like these we follow rules because they have in the past maximized utility for everyone affected. But if we know better, if our judgment is clear, or if our capacities change, then we must abandon the rule or add the exception. Thus rules become fluid and a collapse of rule-utilitarianism into act-utilitarianism may occur. Finally, it is not as if this more sophisticated utilitarian theory will allow the consequentialist to side-step the problems that befall the act-utilitarian. Adherence models or adoption models of rule-utilitarianism may still, in theory, advocate almost any atrocity. If fol-

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61

lowing some rule maximizes utility, then we ought to follow the rule no matter what its content. Suppose the capacities of the dolts, assuming an adoption model, leads them to conclude that others—the ones who have a different skin pigmentation, or religion, or eye color, or gender—lack freewill and are really just simple animals. The dolts adopt the rule “Do what you want with your property or animals” because they figure that following this rule will maximize utility for everyone affected. And assume it would given their capacities. Have we just justified racism or sexism for the dolts? Would we have to say of such a culture that, given their capacities, they ought to follow such a rule? The answer, it could be argued, lies in the difference that Joel Feinberg notes between “(1) What (speaking most generally) are the correct moral principles for use by a private individual in guiding his own personal conduct (including that part of his conduct that falls within the scope of public rules)? (2) Which public rules or regulations of the kind that control private conduct by imposing duties and conferring rights should be adopted by a given community?”62 This latter notion is sometimes called “actual practice rule-utilitarianism” and concerns public rules, maybe laws, already in force.63 Actual practice rule-utilitarianism need not collapse into act-utilitarianism because while certain exceptions will be built into the rules, the general act-utilitarian exception—follow rule R unless acting otherwise would maximize net utility—will almost never be invoked because of the difference between adherence and adoption. Public rules will almost never allow an act-utilitarian exception because citizens are apt to misapply the exception. While this may allow the actual practice rule-utilitarian to avoid a collapse into act-utilitarianism the society of dolts case may still have force and there is now a further problem. What justifies an actual practice rule viewed as a public rule or law? If an actual practice rule is to be justified by utility in relation to the capacities of citizens, then we again have a rule that could have almost any content. If the rule is intended to allow for the maximization of social utility bounded by certain rights of individuals, then an important question has been begged—why think that intellectual property rights are not like other individual rights? I take this latter worry to also apply if we view the rules of Anglo-American intellectual property to be what John Rawls calls constitutive practice rules:64

62

Intellectual Property and Information Control the rules of practices are logically prior to particular cases. This is so because there cannot be a case of an action falling under a rule of a practice unless there is the practice . . . We may think of the rule of a practice as defining offices, moves, and offenses. . . Striking out, stealing a base, balking . . . are all actions which can only happen in a [baseball] game. [Furthermore,] if one wants to play a game, one doesn’t treat the rules of the game as guides . . .65

While this view may be helpful in solving the problem of act description and it may be useful when thinking about the action of registering a copyright, I take that it leaves open the possibility that intellectual property rights may exist prior to and independent of copyright, patent, and trade secret practices.66 Conclusion In conclusion, I would like to mention one final problem with rule-utilitarian justifications of intellectual property. The problem I have in mind is not a difficulty with rule-utilitarianism as a correct moral theory, but how it fits with other rights generating moral theories found in the Anglo-American tradition. Consider a common variation of the incentives argument and the traditional argument that incorporates the notion of a contract between the author or inventor and the government. This view is accurately captured in Fried. Krupp Akt. v. Midvale Steel Co.: Tersely stated, an American patent is a written contract between an inventor and the government. This contract consists of mutual, interrelated considerations moving from each party to the other for such contract. The consideration given on the part of the inventor to the government is the disclosure of his invention is such plain and full terms that any one skilled in the art to which it pertains may practice it. The consideration on the part of the government given to the patentee for such disclosure is a monopoly . . . .67

Here the idea is that mutual benefit can be had between creators and the government ultimately maximizing social utility. Authors and inventors gain by having their works protected for a limited time and society gains by the free flow of information and the ensuing progress.68 If an inventor has no claims to control a particular intellectual work independent of a contract with society, then the subsequent contract seems at best suspect. When two parties contract about what will happen with some good, for the contract to be binding, one of the parties must be entitled to the relevant kind of control over the good in question. Without any prior claims or commitments why not pick someone at random and give them title? The answer typically

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given is that we would then lose the incentive structure needed to drive the entire system—needless to say we are back in the incentives argument. But what if, somehow, we could maintain the incentives to burn the midnight oil while picking intellectual property owners by lottery? What if this system and the contracts that fall out of it maximized overall social utility? Here I am driving at what I call a “global inconsistency problem.” Life rights, privacy rights, and tangible property rights are typically given a deontic base that stand athwart utilitarian concerns. Even if following the rule “don’t violate rights” were to diminish overall social utility, the dominant Anglo-American tradition would be to follow the rule anyway.69 This is not to say that rights are absolute and can never be overridden by bad consequences. The point here is about the grounds of rights not their relative strength. If systems of intellectual property rights are indeed justified on ruleutilitarian grounds and life rights and the like are deontic in nature, then there is a kind of global inconsistency within the Anglo-American tradition.70 Why, for instance, are rights to rocks, cars, and houses justified on different grounds than books, works of art, and processes of manufacture? Why is it the case that my ownership of a copy of your book compared to your ownership of the intellectual work is more resistant, in a deep way, to considerations of consequentialist value maximization? Those of us who find this troubling and agree that the aforementioned internal and external problems with rule-utilitarianism are correct, have good reason to reject rule-utilitarian based justifications of intellectual property rights. These results, if true, call for revisions in Anglo-American systems of intellectual property protection. Alas, these institutions are shot through with rules, tests of rules, statutes, provisions, exemptions, limitations, and the like, that have been justified because the rules and systems supposedly maximize overall social utility. Finally as noted in later chapters, I am not opposed to “social utility arguments” at the governmental level when such activity is restrained by individual “natural” rights. The American system of government can be understood as a method of maximizing social utility within certain constraints. Thus it may be the case that some rights exist independent of governments or institutions while others are simply created by governments and institutions. I will argue in

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the following chapters that intellectual property rights can exist independent of governments or other rights granting agencies. Intellectual property rights are essentially no different than our rights to life, liberty, and physical property. Upon rejecting traditional ruleutilitarian justifications of copyright, patent, trademark, and trade secret, the path is cleared for a new Lockean justification of intellectual property that truly upholds the creative rights of authors and inventors. Notes 1. 2.

3. 4. 5.

6.

U.S. Constitution, § 8, para. 8. See W. Francis and R. Collins, Cases and Materials on Patent Law: Including Trade Secrets - Copyrights - Trademarks, 4th ed. (St. Paul, MN: West Publishing Company, 1987), 92-93. Prior to the enactment of the U.S. Constitution a number of states adopted copyright laws that had both a utilitarian component and a natural rights component. A major tuning point away from a natural rights framework for American institutions of intellectual property came with the 1834 decision of Wheaton v. Peters 33 US (8 Pet.) 591, 660-1 (1834). See “Copyright Enactments of the United States, 1783-1906,” in Copyright Office Bulletin 3 (1906), 14. “Unquestionable, the 1834 decision marked an important turning-pint, in that it distances American copyright law from the natural law perspectives which were very much in evidence at the end of the eighteenth century.” Alain Strowel, “Droit d’auteur and Copyright: Between History and Nature,” in Of Authors and Origins, edited by Brad Sherman and Alan Strowel (Oxford: Clarendon Press, 1994), 245. See also, Edward C. Walterscheid, “Inherent or Created Rights: Early Views on the Intellectual Property Clause,” Hamline Law Review 19 (1995). Nevertheless, anomalies still pop up. “In 1984 the Supreme Court cited Locke when it held that intangible ‘products of an individual’s labor and invention’ can be ‘property’ subject to the protection of the Takings Clause.” Wendy J. Gordon, “A Property Right in SelfExpression: Equality and Individualism in the Natural Law of Intellectual Property,” Yale Law Journal 102 (1993): 1533-609, citing Ruckelshaus v. Monsanto Co., 467 U.S. 986, 1002-03 (1984). Committee Report: 1909 Copyright Act. See also, Sony Corp. of America v. Universal Studios Inc., 464 US 417, 78, L. Ed 2d. 574 (1984). See Joan Robinson, Science as Intellectual Property (New York: Macmillan 1984), 15. See the Committee Report accompanying the 1909 Copyright Act, H.R. Rep. No. 2222, 60th Cong., 2nd Sess. 7 1909. The courts have also reflected this theme: “The copyright law . . . . makes reward to the owner a secondary consideration.” (United States v. Paramount Pictures, 1948) “The limited scope of the copyright holder’s statutory monopoly, like the limited copyright duration required by the Constitution, reflects a balance of competing claims on the public interest: Creative work is to be encouraged and rewarded, but private motivation must ultimately serve the cause of promoting broad public availability of literature, music, and other arts.” (Twentieth Century Music Corp. v. Aiken, 422 U.S. 151, 95 S.Ct. 2040, 45 L.Ed.2d [1974]). Parts of this section draw directly from R. G. Frey’s “Introduction: Utilitarianism and Persons” in Utility and Rights, edited by R. G. Frey (Minneapolis, MN: Uni-

Against Rule-Utilitarian Intellectual Property

7.

8. 9. 10.

11.

12. 13. 14.

15. 16.

65

versity of Minnesota Press, 1984), 3-19 and J. J. C. Smart’s “Extreme and Restricted Utilitarianism, in Theories of Ethics, edited by Philippa Foot (Oxford: Oxford University Press, 1967). Some utilitarians use strategic rules and rules of thumb. Strategic rules are rules that we are almost always more confident in than our calculating abilities. Utilitarians of this sort argue that we should follow the strategic rule even when it looks like violating it will maximize goodness. But when we have strong evidence that breaking a rule in a certain instance will maximize utility, then we should break the rule. For similar views see J. J. C. Smart “Extreme and Restricted Utilitarianism,” and David Lyons, Forms and Limits of Utilitarianism (Oxford: Clarendon Press, 1965). Joan Robinson quoted in D. Nelkin’s, Science as Intellectual Property (New York: Macmillan Press, 1984), 15 (parentheses mine). This kind of rule-utilitarianism is sometimes called “ideal rule-utilitarianism.” In a later section I will address two variants of ideal rule-utilitarianism formulated as Adoption RU (rules that require “acceptance” utility) and Adherence RU (rules that require “ideal conformance” utility). At that time I will also consider a separate view called “actual rule-utilitarianism.” For a lucid account of the many forms of utilitarianism see Lyons, Forms and Limits of Utilitarianism and Joel Feinberg’s review of Lyons, “The Forms and Limits of Utilitarianism,” Philosophical Review (1967): 368-81. See C. Oppenheim, “Evaluation of the American Patent System” in Journal 33 (Patent Office Society, 1951); National Patent Planning Commission: First Report (1943), 783-84; Report of the President’s Commission (1966); Tom Palmer, “Intellectual Property: A Non-Posnerian Law and Economics Approach,” in Intellectual Property: Moral, Legal, and International Dilemmas, edited by A. Moore (Lanham, MD: Rowman & Littlefield, 1997), chapter 7, 179; and Leonard G. Boonin, “The University, Scientific Research, and the Ownership of Knowledge,” Owning Scientific and Technical Information (New Brunswick, NJ: Rutgers University Press, 1989), 257-60. B. Robinson, Robinson on Patents, § 33. Robinson is considered by many to be the foremost early authority on American systems of intellectual property. For example, see Patrick Croskery’s “Institutional Utilitarianism and Intellectual Property” Chicago-Kent Law Review 68 (1993): 631. Some intangible property is rivalrous. “This is true, for instance, in the case of knowledge which gives one a competitive advantage (for example, a trade secret) and for information relating to future events, which allows one to speculate on forthcoming price changes (or example, the lifting of a blockade or a projected takeover).” Ejan MacKaay, “Economic Incentives in Markets for Information and Innovation,” in Harvard Journal of Law and Public Policy 13 (Summer 1990): 892. Edwin C. Hettinger, “Justifying Intellectual Property,” in Intellectual Property: Moral, Legal, and International Dilemmas, edited by A. Moore (Lanham, MD: Rowman & Littlefield, 1997), chapter 1, 30. This view is echoed in the following denials of a common law right to intellectual property. “Wheaton established as a bedrock principle of American copyright law that copyright, with respect to a published work, is a creature of statute and not the product of the common law.” See S. Halpern, D. Shipley, and H. Abrams, Copyright: Cases and Materials (Saint Paul, MN: West Publishing, 1992), 6. “There shall be no monopolies granted or allowed among us, but of such new inventions as are profitable to the country, and that for a short time.” (General court of Massachusetts, 1641). “The monopoly did not exist at common law, and the rights, therefore,

66

17.

18.

19.

20.

21.

22. 23.

24.

Intellectual Property and Information Control which may be exercised under it cannot be regulated by the rule of common law. It is created by the act of Congress; and no rights can be acquired in it unless authorized by statute, and in the manner the statute prescribes” (Chief Justice Taney, Gayler et al. v. Wilder, 1850). This premise and the first premise of the next argument (the traditional argument) could be defended by the act-utilitarian in the following way. Consider the adoption of an institution of intellectual property protection as an act of Congress or government. Members of Congress, in voting to adopt some set of rules, are acting so that social utility is maximized—they are adopting a set of rules and attaching sanctions for violating these rules. The sanctions change the consequences of many actions and thus may change what is the correct action for others. This way of defending the first premise of either argument is not without problems. While such a view would provide a way to side-step the external critique of rule-utilitarianism found at the end of this chapter, it would not answer any of the internal problems discussed. Moreover, it is not as if, by moving from rule-utilitarianism to act-utilitarianism, the defender of this view obtains firmer footing—alas there are many damaging criticisms of act-utilitarianism as well. For a lucid account of many of the problems with act-utilitarianism, see Benard Williams, “A Critique of Utilitarianism” in Utilitarianism: For & Against (New York: Cambridge University Press, 1973), 75-150; John Rawls, A Theory of Justice (Cambridge, MA: Harvard University Press, 1971), 22-34; H. J. McCloskey, “Respect for Human Moral Rights versus Maximizing Good” in Utility and Rights, edited by R. G. Frey (Minneapolis, MN: University of Minnesota Press, 1984), 121-36; David Lyons, Forms and Limits of Utilitarianism; and footnotes 18-21 below. Generally speaking, the problem of justice for act-utilitarianism is, what if doing something unjust maximizes overall utility. For example, what if framing an innocent person would lead to the best consequences for everyone affected? Act-utilitarianism would seem to required such an unjust act—i.e., we would have a moral obligation to frame the innocent person and this seems wrong. The problem of special obligations is that sometimes we have obligations that stand independent of the consequences. For example, it may be best for all concerned that a teacher give everyone A’s but the teacher has a special obligation to award grades based on merit. In general terms, the problem of integrity is that act-utilitarianism requires individuals to treat their own lifelong goals and projects impartially. As a good utility maximizer we each should be willing to abandon our goals and projects for the sake of maximizing overall social utility. The problem is that we cannot be impartial in this way. The problem of excessive demands is that act-utilitarianism demands too much of us. Since everything we do and don’t do has consequences, every action or inaction is moral or immoral. But this seems wrong. Whether I wake up at 10:00 or 10:05 seems to be outside the realm of morality, assuming of course that I have no prior obligations. For example, consider the advances in medical treatment that are seemingly the result of incentive producing structures. While I will not challenge the truth of the third premise in this chapter, it seems dubious as well. When we consider other more pressing social needs and wants like, food, health care, housing, education, safety, and the like, the need for the promotion of many/most intellectual works seems to fall well down on the list. The example comes from Hettinger, “Justifying Intellectual Property,” 31, and from Croskery’s “Institutional Utilitarianism and Intellectual Property,” 637. Croskery’s

Against Rule-Utilitarian Intellectual Property

25. 26.

27. 28.

29. 30. 31.

32. 33.

34. 35. 36.

67

analysis is particularly useful here in that he discusses five possibilities for the production of intangible goods: government production; private production, government reward; market reward, government fine tuning; market production and fine tuning, government fencing; and market production and fencing. Most of these arrangements deviate from our current systems in some respect and if any offer better prospects for society, then the rule-utilitarian must advocate the appropriate changes. It may even be better, overall, to produce fewer intellectual works if the costs are lower. Michael Polanyi, “Patent Reform,” Review of Economic Studies 61 (1944) advocates a system where people invent intangible works as they currently do, are paid by the government, and receive no exclusionary rights to the works. An assessment of the economic value is made by those who use the invention and the government would pay some fraction of this approximate value to the inventor. Fritz Machlup, Production and Distribution of Knowledge in the United States (Princeton, NJ: Princeton University Press, 1962), 168-69. Sindey Winter, “Patents in Complex Contexts” in Owning Scientific and Technical Information (New Brunswick, NJ: Rutger University Press, 1989), 43 (italics mine). The book cited is S. Winter and R. Nelson, An Evolutionary Theory of Economic Change (Cambridge, MA: Harvard University Press, 1982). Jack Hirshleifer, “The Private and Social Value of Information and the Reward to Inventive Activity,” in the American Economic Review 61 (1971): 561. Machlup, Production and Distribution of Knowledge in the United States, 170. For other utilitarian based arguments against owning intellectual property see Richard Stallman, “Why Software Should Be Free,” in Intellectual Property: Moral, Legal, and International Dilemmas, edited by A. Moore (Lanham, MD.: Rowman & Littlefield, 1997), chapter 11; and Arthur Kuflik, “The Moral Foundations of Intellectual Property Rights,” in Owning Scientific and Technical Information (New Brunswick, NJ: Rutger University Press, 1989), 228-31. Machlup, Knowledge: Its Creation, Distribution, and Economic Significance (Princeton, NJ: Princeton University Press, 1984), 164. "In some cases, such as Coca-Cola and Smith’s Brothers cough drops, trade secrecy has provided a century of protection far superior to the limited returns which would have been offered by patent law. . . . Some firms rely on secrecy because they expect a relatively short life for their products. By keeping the product a secret until marketed, the firms gain enough lead time over competitors so that patent protection is not worthwhile. The firms invest in marketing and advertising to protect a share of the market.” Roger Miners and Robert Staaf, “Patents, Copyrights, and Trademarks: Property or Monopoly,” in Harvard Journal of Law and Public Policy 13 (Summer 1990): 927-28. See the Restatement (Third) of Unfair Competition § 39-45. The two restrictions on trade secrets are the requirements of secrecy and competitive advantage. See chapter 2. See Hettinger, “Justifying Intellectual Property,” 32. It may be argued that only independently wealthy artists or artists who receive grants of some kind can afford to pursue their artistic endeavors independent of copyright. The vast majority of artists, however, are dependent on copyright (directly or indirectly) for their livelihood. But this is the very question at issue — are copyright, patent, and trade secret institutions, with their full complement of rights, necessary? As I have been arguing this seems highly unlikely.

68 37. 38.

39.

40. 41.

42.

43. 44. 45. 46.

47. 48. 49.

50. 51.

52.

Intellectual Property and Information Control See the problem of the collapse of rule-utilitarianism into act-utilitarianism below. See Marci A. Hamilton, “The TRIPS Agreement: Imperialistic, Outdated, and Overprotective” and Hugh C. Hansen, “International Copyright: An Unorthodox Analysis,” both in Intellectual Property: Moral, Legal, and International Dilemmas, edited by A. Moore (Lanham, MD.: Rowman & Littlefield, 1997). An obvious example is the progress of the computer industry. As things now stand ROM, RAM, and CPU speed doubles every eighteen months (an Internet year is only six months!). With such accelerated turnover it is difficult to understand the need for twenty years of patent protection and a lifetime plus seventy years for copyright protection. Bootlegging is generally understood as the direct copying of some kind of digital information and then the subsequent marketing and sale of the copies. Pirates merely copy, they don’t sell. For radical deconstructionist arguments calling for the elimination of copyright and patent protection, see Tom Palmer, “Intellectual Property: A Non-Posnerian Law and Economics Approach” in Intellectual Property: Moral, Legal, and International Dilemmas, edited by A. Moore (Lanham, MD.: Rowman & Littlefield, 1997), chapter 7. I first heard of this method from Duane Smith, Vice President, Chief Operating Officer, Vision Quest 2000, Inc. in an interview. It is also mentioned in E. Von Hippel, “Appropriability of Innovation Benefit as a Predictor of the Source of Innovation,” Research Policy 11 (1982), cited in Winter, “Patents in Complex Contexts,” 54. Adapted from Becker’s Property Rights: Philosophic Foundations (London: Routledge & Kegan Paul 1977), 57-67. Here again, and throughout this section, I am indebted to Becker’s analysis. David Hume, Treatise of Human Nature, book III, part II, § II. Becker, Property Rights, 61. Sometimes a genetic-based defense is given here. Part of human nature is the desire to set personal boundaries, the crossing of which would cause great psychological distress. These intimate personal boundaries naturally extend to one’s acquisitions. It is claimed that not only physical, but psychological well-being rests on the protection of these boundaries. A number of empirical studies seem to support such a view. See E. O. Wilson, Sociobiology (Cambridge, MA: Harvard University Press 1975); E. T. Hall, The Hidden Dimension (New York: Doubleday, 1966); and G. Allport, Becoming (New Haven, CT: Yale University Press, 1955). Why, for instance, is the exclusivity of intellectual property guaranteed by legal rights necessary for human flourishing? Why is imposed scarcity needed? Adapted from Becker, Property Rights, 89. Some have argued, however, that systems of intellectual property have a leveling effect on the distribution of goods and income or that, at least, such institutions are non-elitist. See Justin Hughes, “The Philosophy of Intellectual Property,” in Intellectual Property: Moral, Legal, and International Dilemmas, edited by A. Moore (Lanham, MD.: Rowman & Littlefield, 1997), chapter 5. Becker, Property Rights, 89. 17 U.S.C. § 102(b) (1988) states, “In no case does copyright protection for an original work of authorship extend to any idea, procedure, process, system, method of operation, concept, principle, or discovery, regardless of the form in which it is described, explained, illustrated, or embodied in such work.” See 17 U.S.C. § 102(b); International New Service v. Associated Press 248 U.S. 215, 39 S.Ct. 68, 63 L.Ed. 211 (1918); Miller v. Universal City Studios, Inc. 224

Against Rule-Utilitarian Intellectual Property

53. 54.

55.

56. 57. 58.

59. 60. 61.

62. 63.

69

USPQ 427 (1984, CD Cal); and Midas Productions, Inc. v. Baer 199 USPQ 454 (1977, DC Cal). I would like to thank Sanford Thatcher for bringing this point to my attention. The problems of act description and with adherence and adoption are advanced by J. J. C. Smart in “Extreme and Restricted Utilitarianism,” Theories of Ethics, edited by Philippa Foot (Oxford: Oxford University Press, 1967); David Lyons in Forms and Limits of Utilitarianism (Oxford: Clarendon Press, 1965); R. B. Brandt in Ethical Theory (Englewood Cliffs, NJ: Prentice Hall, 1959), 396-400; “Toward a Credible Form of Utilitarianism, in Morality and the Language of Conduct, edited by H. Castanenda (Detroit, MI: Wayne State University Press, 1963), 107-40; and Don Hubin, unpublished manuscripts. The form of the arguments given draw directly from Hubin and indirectly from Lyons and Brandt. Adapted from an example given by Hubin (unpublished manuscripts). See also, Eric D’Arcy, Human Acts: An Essay in their Moral Evaluation (Oxford: Oxford University Press, 1963), 3 (Darcy attributes this type of example to J. J. C. Smart) and Johnathan Harrison, “Utilitarianism, Universalization, and our Duty to Be Just,” Proceedings of the Aristotelian Society (1952-53). This problem is similar to the problem of the sly maxim maker and Kant’s first formulation of the categorical imperative. Eric D’Arcy, Human Acts. 1-61; Lyons, Forms and Limits of Utilitarianism, chapter II. If we constrain utility maximizing arguments through the use of deontic based rights—this is basically how our current constitutional system is arranged—it may be possible to appeal to deontic norms to determine appropriate act descriptions. If the Lockean model presented in chapters 4-7 is correct, though, intellectual property rights will be recast in a deontic light that insulates them from utility maximization arguments. Hubin unpublished manuscripts. J. J. C. Smart, “Extreme and Restricted Utilitarianism,” 177. This is also how many act-utilitarians attack rule-utilitarianism. Rule-utilitarianism ends up looking like superstitious rule worship. "If unrestricted adherence RU is to be distinct from AU, there must be some action, call it Abest, that produces the best consequences but is prohibited by the best moral rule. Call this rule Rbest. Imagine that this is so. (Or, try to imagine it, because as it will turn out, it is impossible. This is the key to the argument. If it is impossible for this to be true, then this version of RU is equivalent to AU.) Rbest requires Anot-best instead of Abest. Now imagine another rule that is exactly like Rbest except that instead of requiring Anot-best it requires in its place Abest. Now compliance with this other rule, will produce all the utility that compliance with Rbest will at every other time, but, when it comes time to perform Abest or Anot-best, this other rule will produce more utility than Rbest. So, this other rule produces equal utility to Rbest at all other times and more utility in the choice of Abest over Anot-best and, therefore, it produces more utility than Rbest. But that means that Rbest isn’t the best rule — the other rule is better. This violates our original assumption and shows that it is not possible for the best rule to require anything but the best action at every time.” Hubin (unpublished manuscripts). Joel Feinberg, “The Forms and Limits of Utilitarianism,” 377. Feinberg notes that a defense of actual practice rule-utilitarianism is given by John Rawls. See J. Rawls, “Two Concepts of Rules,” Philosophical Review 64 (1955): 332, reprinted in Theories of Ethics, ed. Phillippa Foot (London: Oxford University Press, 1967), 144-70 (all page citations refer to the reprint).

70 64. 65. 66. 67.

68. 69. 70.

Intellectual Property and Information Control Rawls, “Two Concepts of Rules,” 163. Rawls, “Two Concepts of Rules,” 163-64. For further worries with Rawls’ view and, more generally, with actual practice ruleutilitarianism and ideal rule-utilitarianism, see Lyons Forms and Limits of Utilitarianism, chapter V. Fried. Krupp Akt. v. Midvale Steel Co. (C.A.3, 1911), 191 Fed. 588, 594. See also, National Carbon Co. v. Western Shade Cloth Co. (C.A.7, 1937), 93 F.2d 94, 96 cert. den. 304 U.S. 570, 82 L.ed 1535 (1938); Tschappat v. Hinderliter Tool Co. (C.A.10, 1938), 98 F.2d 994 998; Strong-Scott Mjg. v. Weller (C.A.8 1940), 112 F.2d 389, 394; David Airfoils v. United States (1954), 124 F. Supp. 350, 352, cert. den. 348 U.S. 950, 99 L.ed. 742; B. Bugbee, The Genesis of American Copyright and Patent Law (Public Affairs Press, 1967), 10. David Carey, The Ethics of Software Ownership (Ph.D. Dissertation, Pittsburgh University) 1988, offers a lengthy defense of this view. It could be argued that the purpose of the Bill of Rights is to protect individuals from utilitarian-type reasoning—we don’t want lives, goals, and projects left at the mercy of policies engineered to promote social utility. Palmer argues that this is good reason for revising or eliminating the regimes of copyright and patent. Michael Davis echoes this concern in “Patents, Natural Rights, and Natural Property,” Owning Scientific and Technical Information (New Brunswick, NJ: Rutger University Press, 1989), 241-44.

4 A Pareto-Based Proviso on Original Acquisition “Whatsoever then he removes out of the State that Nature hath provided, and left it in, he hath mixed his Labour with, and joyned to it something that is his own, and thereby makes it his Property. It being by him removed from the common state Nature placed it in, it hath by this labour something annexed to it, that excludes the common right of other Men.” —John Locke The Second Treatise Of Government1

Introduction One of the most promising strategies for justifying property rights begins with the claim that individuals are entitled to control the fruits of their labor. Laboring, producing, thinking, and persevering are voluntary and individuals who engage in these activities are entitled to what they produce. Subject to certain restrictions, rights are generated when individuals mix their labor with an unowned object. “The root idea of the labor theory is that people are entitled to hold, as property, whatever they produce by their own initiative, intelligence, and industry.”2 The intuition is that the person who clears land, cultivates crops, builds a house, nurtures livestock, or creates a new invention obtains property rights by engaging in these activities. One version of Locke’s famous argument goes as follows.3 Individuals own their own bodies and labor—i.e., they are self-owners. When an individual labors on an unowned object her labor becomes infused in the object and for the most part, the labor and the object cannot be separated. It follows that once a person’s labor is joined with an unowned object, and assuming that individuals exclusively own their body and labor, rights to control are generated. The idea is that there is a kind of expansion of rights. We each own our labor 71

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and when that labor is mixed with objects in the commons our rights are expanded to include these goods. Locke’s argument is not without difficulties.4 Some have argued that the idea of mixing one’s labor is incoherent—actions cannot be mixed with objects.5 The following objections have also been raised. Why isn’t mixing what I own (my labor) with what I don’t own a way of losing what I own rather than gaining what I don’t?6 Why shouldn’t the second labor on an object ground a property right in an object as reliable as the first labor?7 Why shouldn’t mixing one’s labor with an unowned object yield more limited rights than rights of full ownership? 8 What constitutes the boundary of one’s labor? If one puts up a fence around ten acres of land does one come to own all of the land within or merely the fence and the land it sits on?9 And finally, if the skills, tools, and inventions used in laboring are social products should not society have some claim on the laborer’s property?10 Among defenders of Lockean-based arguments for private property, these challenges have not gone unnoticed.11 My goal in this chapter is not to answer these challenges or to rehearse the various strands of Lockean labor-mixing arguments. What I am particularly interested in is Locke’s proviso that justified acquisitions must leave “enough and as good for others.” This restriction on acquisitive behavior is what Robert Nozick called “the Lockean proviso.”12 “For this labor being the unquestionable property of the laborer, no man but he can have a right to what that is once joined to, at least where there is enough and as good left for others.”13 The primary focus of this chapter is to examine and clarify a number of important issues that surround the use of Locke’s proviso. What does it mean to leave enough and as good for others and can such a requirement, in any way, justify rights to control what is found in the commons? My hope is that by examining the property theories of Robert Nozick and David Gauthier, and in particular their distinct uses of Locke’s proviso, we will be able to overcome certain problems that proviso-based theories of property have faced and move toward a defensible theory that justifies the control of both tangible goods and intellectual works. A Historical and Topical Examination of the Lockean Proviso Robert Nozick offers a sketch of a theory of justified entitlement incorporating a version of Locke’s proviso. Nozick claims that the

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proviso should be understood as requiring that the situation of others not be worsened by one’s acquisitive behavior. Thus, for Nozick, the proviso is a necessary condition for justified appropriation. As each new interpretation of the proviso is offered, I will examine it as a sufficient condition as well as a necessary condition. Hopefully, by preceding this way the strengths and weaknesses of proviso-based property theories will be clarified. Nozick’s Theory of Acquisition In answering the question, “what counts as being worsened by another’s appropriation?” Nozick offers two possibilities. One way a person could be worse-off is, by losing the opportunity to improve his situation by a particular appropriation or any one (or any appropriation)14

On this reading, a necessary condition for justified acquisition is that others not lose out in terms of opportunities to improve their situation through appropriation. A proviso incorporating this way to be worsened would be: NP1: A process normally giving rise to a property right in a previously unowned thing will not do so if the position of others is worsened in terms of lost opportunities to acquire.

The objection to NP1 is that it leaves us with what Nozick calls the reverse domino problem.15 Imagine some person, Z, who cannot appropriate anything because everything has been appropriated and is thereby worse-off in terms of lost opportunities to improve his situation. Now person Y, who appropriated the last bit of the commons, has violated the proviso and her acquisition is illegitimate. Y’s acquisitions are illegitimate because this will leave Z with no opportunities to improve his situation through appropriation. But if Y’s acquisitions violate the proviso because of Z’s lost opportunities, then the acquisitions of X (the person who appropriated just before Y) are illegitimate because of Y’s lost opportunities. This process continues back to A, who finds his acquisitions in violation of the proviso. Nozick argues that this proviso is too strong—i.e., it does not capture what it means to be worsened and requires what almost no acquisition could satisfy. If some individual appropriates a grain of sand from an endless beach are others worsened because they can-

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not now improve their position by using that grain of sand? Moreover, suppose that a superb manager of resources acquires the whole of an island where ten individuals live. Suppose further that the new owner employs her ten fellows and compensates them beyond the value they produced or could have produced. Have these individuals been worsened because they cannot acquire unowned objects from the commons? If the answer is no, then this proviso does not adequately account for what it means to be bettered and worsened and thus fails as a necessary condition. While Nozick did not consider this, suppose we interpret the proviso as a sufficient condition rather than a necessary condition for justified appropriation.16 SP1: If no one’s position is worsened by an acquisition in terms of lost opportunities to acquire, then an acquisition is justified.

Assuming that when most objects are appropriated others will be excluded from using them, those individuals who did not appropriate them will have lost the opportunity to improve their situation by a specific appropriation and will thereby be worse-off. In fact, any singular appropriation will cause others to be worse-off because they will have lost the opportunity to improve their situation by appropriating that object. As before, SP1 is violated when Fred appropriates a grain of sand from a endless beach, because Ginger has lost the opportunity to improve her situation by appropriating that same grain of sand (assuming of course that Ginger would be better-off by appropriating that grain of sand). This objective account of worsening trivializes the notions of bettering and worsening. Consider the worsening that arises when Fred takes a drink of water. His fellows have lost the opportunity to improve their situation by drinking that water. Certainly these kinds of worsenings are trivial or morally irrelevant (assuming water is abundant, etc.), so it would seem that SP1 is too strong to be interesting as a sufficient condition. A general problem with SP1 is that the terms of being worsened are too narrow—it focuses only on opportunities to improve one’s situation through appropriation. Imagine a case where if Ginger appropriates some object it will improve her situation n amount, but if Fred appropriates the object it will improve Ginger’s situation n+1. Now imagine the case where Ginger is made better-off if Fred appropriates everything compared to how she would have been had

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Fred not appropriated. Although Ginger has lost all of her opportunities to improve her situation through appropriation her position is still better. The upshot of this is that it is not merely opportunities to improve one’s situation through appropriation that count; there are other morally relevant factors present. This is to say that SP1 is not sufficient. Nozick dismisses a proviso based on the first way of being worsened (NP1) and offers a second way that individuals may be worsened by the acquisitive behavior of their fellows. A person could be worsened, by no longer being able to use freely (without appropriation) what he previously could17

A proviso incorporating this way to be worsened would be: NP2: A process normally giving rise to a property right in a previously unowned thing will not do so if the position of others no longer at liberty to use the thing is thereby worsened.

“With the weaker requirement, we cannot zip back so quickly from Z to A, as in the above argument; for though person Z can no longer appropriate, there may remain some for him to use as before.” 18 Nozick avoids the regress of the reverse domino problem by adhering to NP2. But surely, one reading of NP2 is too stringent as well. The appropriation of any object will make me worse-off in this sense given that I can no longer freely use the object. Given a more general reading of NP2, one that considers an individual’s overall position and not merely how they fare relative to some particular object that has been acquired, in conditions of scarcity it seems plausible to maintain that individuals can justly acquire and not leave their fellows enough to use. Imagine the classic desert island case where there is little food or fresh water. In this case when individuals appropriate, they will worsen their fellows in terms of liberties to use, yet such acquisitions seem permissible. If so, then we have found a case that shows NP2 is not a necessary condition for justified appropriation.19 Suppose, however, that we incorporate this way of being worsened into a proviso interpreted as a sufficient condition: SP2: If no one’s position is worsened by an acquisition in terms of lost freedoms to use, then the acquisition is justified.

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SP2, which sets the terms of being worsened as lost freedoms to use, is also problematic. In a narrow sense we consider how Ginger would be in terms of freedoms to use some particular object after Fred has appropriated the object, compared to her freedoms to use the object before Fred’s appropriation. On this reading SP2 is too strong to be interesting because any appropriation will cause others to lose the freedom to use what was appropriated. Once everything has been appropriated everyone will be worse-off in this sense, even those who have appropriated a generous amount of the commons (each will have fewer freedoms to use things). A defender of SP2 might claim that this is too fast and move to a more general reading of the proviso. Maybe it is not your loss of liberty to use some particular object that counts—what counts is that you have enough and as good left over to use. Nozick implies that at some point appropriation of the commons will stop, leaving individuals in a world where some property remains in the commons and other property is held exclusively. Imagine a world where half of the objects, including land, were held in common (as if it were still in the state of nature) while the other half had been appropriated (maybe it is the proviso itself that halts appropriation). It might be argued that in this case the proviso is satisfied. Those who have appropriated have not made their fellows worse-off because there is plenty left to use. But we may ask why? Given the appropriation of some object by another, there is now something that you cannot use. Why is it the case that this limitation of your freedom does not count as worsening? I will flag this question for later consideration. There is a case which I call the “exploited worker case” that shows this general version of SP2 to be too weak—i.e., it does not pick out all morally relevant worsenings surrounding legitimate appropriation. It should be clear that this is a problem with the terms of being worsened. Suppose Fred appropriates all of the land on an island and offers Ginger a job at slightly higher earnings than she was able to achieve by living off of the commons. Although Ginger is worseoff in terms of liberties to freely use, she has secured other benefits that serve to cancel out this worsening. So far so good. But now suppose in a few months Ginger would have independently discovered a new gathering technique that would have augmented her earnings fivefold. Having achieved this success she would have gone on

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to discover even better techniques, ultimately ending in a fully satiated life in the commons. Instead, Ginger spends her life working in quiet drudgery and Fred becomes fully satiated.20 This is actually a case where SP2 is violated and the compensation offered does not take into account Ginger’s opportunities to use things in the future. Ginger has been compensated for her loss of freedoms to use things at the time of appropriation but is still worsened in terms of future opportunities to improve her situation by using things. Part of Ginger’s wealth now may be her opportunities to use more things at some future time. The first conclusion to be drawn from the exploited worker case is that SP2 lacks opportunity costs and thus allows morally relevant worsenings to occur. Furthermore, even if opportunity costs to use were incorporated, SP2 would be unsuitable as a proviso. An individual might be left unaffected in terms of his opportunities to use things but still be worsened in terms of lost opportunities to acquire wealth. Certainly there is a difference between opportunities to use and opportunities to acquire a particular level of material well-being, for the latter may only be possible given the security of tenure that is not guaranteed by mere use. Consider SP2' where worsening is measured in terms of freedoms and opportunities to use things. SP2' differs from SP2 only because SP2' contains opportunity costs surrounding use. Now consider the exploited worker case again, only this time imagine that Fred has compensated Ginger for her future opportunities to use things as well as her current freedoms to use things. Suppose further that Ginger had (before Fred’s appropriation) certain opportunities to improve her situation through appropriation above and beyond her opportunities to improve her situation through mere use.21 What the exploited worker case shows (in this context) is that it is not only opportunities to use things freely that matter, but other opportunities may count as well. In this case (when we know for certain of Ginger’s future earnings) opportunities to acquire wealth or to earn more seem relevant to Fred’s appropriation. Gauthier echoes Locke and reminds us of this point: Clearly it is not enough to leave others as they were before, able to carry on with their present activities and to reap benefits equal to those attained in the past, if one also deprives them of opportunities previously available for bettering themselves without affording them new alternatives.22

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In summary, SP2 fails as a sufficient condition for original acquisition because it does not incorporate opportunity costs and SP2' (which builds in opportunities to use) is inadequate because it fails to incorporate opportunities to acquire or own. Moreover, what we think is wrong about Fred acquiring so much that it interferes with Ginger’s opportunities to use is also present in the case of her opportunities to acquire. Although Nozick correctly identifies the Paretian, or no harm no foul, intuition that grounds the proviso, he neither adequately defines what it means to be better-off or worse-off nor seriously considers the baseline problem—bettered or worsened relative to what? David Gauthier’s property theory characterizes the baseline situation and gives an account of bettering and worsening in terms of subjective preference satisfaction that sharply contrasts with Nozick’s objective account. We will now turn to Gauthier’s theory. Gauthier’s Modified Lockean Proviso Gauthier uses his version of the Lockean proviso as a general constraint on action to ensure that the initial bargaining position (where we agree about the benefits and burdens of social interaction) is fair.23 The proviso provides a fair bargaining position because it provides for basic rights and thus eliminates prior predation and parasitism from undermining the force of the agreement.24 If an agreement is made under duress of some sort—suppose a gun is pointed at someone or a forceful threat has been made—then it can hardly be claimed that the obligations generated from the agreement are binding. Gauthier interprets the Lockean proviso so that it prohibits worsening the situation of another, through interaction with that person, except to avoid worsening one’s own position. The base point for determining bettering and worsening is how those affected would be in your absence (see P3/B2 in Table 4.1) and the terms of being worsened are determined by preference satisfaction. “We may treat ‘better’ and ‘worse’ as unproblematic; one situation is better for some person than another, if and only if it affords him greater expected utility.”25 Expected utility, for Gauthier, is couched in terms of subjective preference satisfaction. Consider the following proviso: P3: If no one’s position is worsened (in terms of subjective preference satisfaction) by another’s action compared to how they would be were the action-taker absent, then the action is permitted.

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Gauthier uses P3 to assign basic rights in the following way. Each individual, in the absence of others, may expect to use his own powers but not theirs. How one would be in the absence of others provides the base point of comparison. Continued use of one’s own body and capacities in the presence of others may fail to better their situation but it does not in itself worsen their situation (compared to how they would be in your absence). Finally, using the body and powers of another, in interfering with their own use, does worsen their situation and is therefore prohibited: Thus the proviso, in prohibiting each from bettering his situation by worsening that of others, but otherwise leaving each free to do as he pleases, not only confirms each in the use of his own powers, but in denying to others the use of those powers, affords to each the exclusive use of his own.26

Gauthier concludes that each individual’s rights to their body and powers is thus justified. When Gauthier moves to justify property rights in external objects he switches the baseline and thus we have a new version of P3 (see P3' below). His justification of property rights takes the following form: We must ask whether someone, in seeking exclusive use of land or other goods, violates the proviso, bettering her situation through worsening that of others. If not, then we must ask whether some other person, in interfering with a claim to exclusive use, violates the proviso. If so then the proposed right is established.27

Gauthier’s version of the Lockean proviso for acquisition (P3') holds that Eve cannot better her situation (by acquiring some particular object) through worsening the situation of Adam. The baseline or context is how Adam would be in the acquisitive case (where Eve had appropriated some particular object) compared to the non-acquisitive case (where the object was left in the commons): P3': If no one’s position is worsened (in terms of subjective preference satisfaction) by another’s acquisition compared to how they would be were the acquired object left in the commons, then the acquisition is permitted.

Gauthier points out that, “. . . although Eve intends to better her situation in relation to her fellows, she need not seek to bring this about by worsening their situation.”28 Her fellows do lose the freedom to use the part of the commons that Eve has appropriated, but given that Eve’s plot of land is not overly large, they may receive other benefits as well. Gauthier argues:

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Intellectual Property and Information Control Planned intensive cultivation made possible by her security of tenure may well make it possible for her to live better on a part of the island sufficiently small that the others would also be better-off, living without her on the remaining land, than they were when all used the entire island in common . . . . Hence her (Eve’s) appropriation may enable everyone to improve her situation, in relation to the base point set by use in common, so that it does not violate the proviso.29

Generally, Gauthier claims that Eve’s fellows are not made worseoff so the appropriation does not run afoul of P3'. Furthermore, once Eve’s right to the land has been established, any interference or seizure of her property will violate the proviso because the individual seizing Eve’s property is making himself better-off by worsening her position. Gauthier concludes that Eve’s right to the plot of land is thus vindicated.30 To take stock of our results and to clarify the issues we must consider, I offer the following Proviso/Baseline table. Be aware that this table represents only a small sample of the possible baselines and provisos. Table 4.1 The Baseline Table B1: the acquisitive case compared to the commons (no property rights) B/W as mere use

B/W as use + opps.

SP1 SP2 SP2'

B/W as opps. to acq.

B2: the acquisitive case compared to the case where the appropriator is absent B/W as pref. sats.

B/W as use + opps.

B/W as opps. to acq.

B/W as pref. sats.

X X X

P3 P3'

B/W as mere use

X X

SP1-P3' are the different provisos. B1 and B2 are baselines. B1 = the acquisitive case where someone appropriates something compared to the commons where there are no property rights. B2 = the acquisitive case compared to the case where the individual who appropriated is absent. B/W = bettering and worsening. Mere use = current freedoms to use things without opportunity costs. opps. to acq. = opportunities to acquire. pref. sats. = preference satisfaction.

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Problems for Gauthier Suppose Adam, who also inhabits the island where Eve resides, prefers that Eve not own any land. In fact, this preference consumes him and generally centers his world—a world where Eve privately owns a plot of land represents a chaotic nightmare for Adam while the actual world, where Eve owns nothing, is one of bliss.31 If bettering and worsening are couched in terms of subjective preference, then in seeking exclusive rights to the plot of land, Eve worsens Adam’s situation. It seems as if Gauthier has forgotten this part of his theory. In trying to vindicate Eve’s appropriation of land Gauthier does not discuss the preferences of her fellows, yet for Gauthier it is preferences that count. Gauthier does consider lost opportunities to improve one’s situation in terms of wealth and concludes that Eve betters her fellows in this respect. But if bettering and worsening are couched in terms of subjective preferences it is not clear why Gauthier argues as he does. There are three general problems with allowing the notion of “worse-off” to be explained in terms of subjective preferences when considering the acquisition of goods.32 The first two problems are based on examples found in Hubin and Lambeth’s “Providing For Rights.” (See note 24) First, the manipulation of preferences will artificially allow some to bypass the proviso. Imagine the case where a parent shapes a child so that the child prefers that the parent own everything. Any other situation causes the child to be worse-off in terms of preference satisfaction. The parent then appropriates everything he can, hires his child at subsistence wages and lives a full satiated life. The proviso has been effectively bypassed through the manipulation of preferences. Second, individuals with quirky or odd preferences will be able to legitimately stop specific appropriations. Given a sufficiently odd preference, one individual may be able to halt all appropriation. Imagine the case where Adam prefers to own everything, and anything less will devastate him psychologically. Upon appropriating a grain of sand from an endless beach Eve violates the proviso making Adam worse-off in terms of subjective preference satisfaction.33 Finally, if compensation is allowed to rectify a worsening caused by an appropriation and the compensation must be proportionate to the loss, then those who lose big in terms of subjective preferences

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will acquire more compensation (maybe lost preferences can be compensated by the fulfillment of other preferences). Suppose the compensation required to rectify the worsening caused by an acquisition must fully compensate—i.e., it must return the individual to his preappropriation level of utility. Now, the preference that “Adam gets everything” is very dear to him and Eve’s appropriation of a grain of sand causes him great psychological distress calling for considerable compensation. This is a problem for P3' because worsening will be allowed so long as compensation is paid. But if the amount of compensation depends on the value of some subjective preference (and maybe its intensity), then the compensation mechanism of the proviso will be askew in some cases. Imagine a case where most of us think that a legitimate appropriation of the commons has taken place. Consider the small rock appropriator Fred. Fred has been living in the commons for some time and decides one day to polish a small rock into a marble. He randomly selects a rock from the almost endless supply found on earth and begins laboring. After a week of work Fred finishes, satisfied with his somewhat imperfect but smooth marble. This example provides a general case against P3'. It might be that Ginger prefers that Fred not appropriate the small rock, so in seeking exclusive rights to the rock Fred violates P3'. Surely this seems an odd conclusion given the abundance of small rocks. Fred has left “enough and as good” for his fellows. Our imaginary case finds its force in that there is a sufficient amount of material for others to use and appropriate after the appropriation—i.e., his fellows are left with the same opportunities (in the relevant sense) to improve their situation as they were before Fred’s appropriation. Furthermore, there are a host of problems surrounding the baseline that Gauthier chooses. The baseline or context is how Ginger would be in the acquisitive case (where Fred had appropriated some particular object) compared to the non-acquisitive case (where the object was left in the commons). But how do we characterize the commons? Imagine that if Fred did not appropriate the object Eve would have destroyed it through careless use. Is what Eve does (hypothetically) with the object part of Ginger’s baseline situation in the commons? If not, why not? Suppose that if Fred does not appropriate some object it will be appropriated jointly by Ginger and Eve. Is this counterfactual part of Ginger’s baseline situation? Naively, we might

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claim that the only relevant counterfactual situation that counts is where the object in question is forever left in the commons. But this artificially restricts the baseline situation without argument. Suffice it to say, any adequate theory of property rights based on the proviso must clarify the baseline situation while providing an argument for a specific characterization of that context. In summary, this historical and topical examination of the proviso has shown that neither SP2 nor P3'34 capture all of the morally relevant worsenings that surround the acquisition of property and therefore neither can serve as a sufficient condition for legitimate acquisition meant to ensure that no one is made worse-off.35 SP2 lacks a provision for opportunity costs and, even if such a provision were incorporated, SP2 would still be inadequate. An individual might be left unaffected in terms of his opportunities to use things, but still be worsened in terms of lost opportunities to acquire wealth. P3' seems hopelessly mired in preference manipulation problems. These problems surround the terms of being worsened, but there also appear to be equally damaging problems with the context or baseline of P3'— and this point could be made with respect to each version of the proviso that we have covered. Finally, we are left where we started. Although SP1 has its difficulties I will argue in the second part of this chapter it can be salvaged. Values, Opportunities, and the Baseline Problem Although fault has been found with Nozick’s objective and Gauthier’s subjective account of bettering and worsening, an adequate account of bettering and worsening can still be given. As indicated by the cases we have been considering, it seems that any adequate account of bettering and worsening will include as valuable wealth or material well-being and opportunities to better ourselves in terms of material well-being. Wendy Gordon insightfully recognizes that “What needs to be established is not simply whether harm is done, but rather whether there is unjustified or wrongful harm.”36 Here, in the most general terms, I am worried about acquisitions that cause unjustifiable harm. If “bettering,” “worsening,” “material standing” (wealth), and “opportunities to increase one’s material standing” are to be defined, a theory of value must be adopted and defended. The sketch of a theory of value that follows is not intended to be complete. There

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are no knockdown arguments forthcoming that illuminate the following sketch as unassailable. Alas, that is another project.37 What is offered are weak and widely held views about value theory and deeper moral commitments. A Sketch of a Theory of Value38 Human well-being or flourishing is the sole standard of intrinsic value. There are at least two reasons to accept this view. First, happiness or flourishing is what is generally aimed at by everyone and second, it seems absurd to ask what someone wants happiness or well-being for. Although the fact that everyone aims at well-being or flourishing does not establish it as the sole standard of intrinsic value, it does lend credibility to the claim that flourishing is valuable. Moreover, given that well-being is not merely an instrumental good, it is plausible to maintain that it is intrinsically good.39 Finally, well-being or flourishing is general in scope, meaning that it can accommodate much of what seems intuitively correct about other candidates for intrinsic value (e.g., pleasure, love, friendship). Human beings or persons are rational project pursuers, and wellbeing or flourishing is attained through the setting, pursuing, and completion of life goals and projects. Both of these claims are empirical in nature. Humans just are the sort of beings that set, pursue, and complete life goals and projects. Project pursuit is one of many distinguishing characteristics of humans compared to nonhumans—this is to say that normal adult humans are, by nature, rational project pursuers. The second empirical claim is that only through rational project pursuit can humans flourish—i.e., a necessary condition for well-being is rational project pursuit. Certainly this view is plausible. A person who does not set, pursue, or complete any life goals or projects cannot be said to flourish in the sense of leading a good life—in much the same way that plants are said not to flourish when they are unhealthy or when they do not get enough sunlight or nourishment. To say that a life plan or project is rational is to say that it accommodates both general and specific facts about human nature. A general fact about human nature is that humans are project pursuers or that humans covet things. Specific facts are facts about specific individuals like Crusoe cannot jump more than three inches and is under six feet tall. If Crusoe’s life plan is to obtain a starting job as a

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center in the NBA his project is irrational. As things stand, and assuming that he has no other special capacities, Crusoe will not achieve his goals and is therefore not aiming at the good. My position concerning rationality is clearly anti-Humean. A distinguishing feature of Humean and neo-Humean accounts of rationality, at least as I understand them, is the view that ends, goals, or lifelong projects, are not the proper subjects of rational appraisal. On this view, individuals just have ends, goals, or desires, and rationality is merely a kind of means to ends efficiency. The rational person is one who takes the most efficient steps to satisfy her desires, even if the desires are questionable in certain respects. If your end is to eat chocolate ice cream until a gustatory rejection occurs, then there will be one way, or a number of equally good ways, to satisfy this desire. Preceding, straightway, to the ice cream store and beginning the binge may be the most efficient means to this end. If so, then on the Humean account we would call this person “rational.” In one way I think that Hume was correct. Whatever your ends, there are more efficient and less efficient ways of achieving them. Where I part company with this view is by advocating that ends, goals, or desires can be rationally appraised. This is just to say that means to ends rationality is not the whole of rationality. To call an action or a plan of action rational is also to reflectively endorse the end or goal. Let me give an example that clearly distinguishes my view from the Humean view. Suppose that you wanted to see how long you could survive by consuming nothing but your own body parts. If you carry out this end in an efficient manner, then the Humean will have to call you rational. On my view, while we may call you efficient given your end, the end and your pursuit of it would be considered manifestly irrational—certainly not something which can be reflectively endorsed. Obviously these are contentious issues. My goal here, is not to defend a particular conception of rationality, but to indicate the plausibility of non-Humean accounts.40 Lastly, I would like to say something about why one’s relations to external physical goods and opportunities to better one’s material standing are valuable. Whatever life project or goal is chosen, within the constraints already in place, individuals will need to use physical objects.41 This should not be taken as an argument for private property, but rather as a claim that material relations and opportunities to better oneself in terms of material relations are objectively

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valuable. So far, the scope and form of the material relations and opportunities are left open. Bettering and Worsening We are now in a position to define “bettering” and “worsening” in terms of material standing or wealth, and opportunities to increase one’s wealth. For now, assume a state of nature situation where there are no formal property relations similar to a system of private property. Bettering and worsening are measured in terms of material standing or wealth and opportunities to increase one’s material standing. Lysander Spooner voices a similar view: The term wealth properly includes every conceivable object, idea, and sensation, that can either contribute to, or constitute, the physical, intellectual, moral, or emotional well-being of man. . . On the other hand, if we admit a right of property in incorporeal things at all, then ideas are as clearly legitimate subjects of property, as any other incorporeal things that can be named. They are, in their nature, necessarily personal possessions; they have value; they are the products of labor; they are indispensable to the happiness, well-being, and even subsistence of man; they can be possessed by one man, and not by another; they can be imparted by one man to another . . .42

As stated, the view that bettering and worsening should be explicated in terms of material well-being is not quite right because any acquisition will cause others to lose the opportunity to use or acquire, assuming that the opportunity is legitimate. Crudely, it is not how you fare vis-à-vis some particular object that determines your legitimate wealth, income, and opportunities to obtain wealth. 43 Imagine someone protesting your acquisition of a grain of sand from an endless beach, claiming that she can now no longer use that grain of sand and has thereby been worsened. What is needed is an “all things considered view” of material well-being or wealth, income, and opportunities to acquire wealth. A better interpretation of “worsening” and “bettering” is that we are concerned with keeping others at the same level of material well-being. To be able to achieve or sustain a certain level of material well-being is important because it determines the range of individual physical activity which directly affects project pursuit. Suppose it is the case that before Crusoe’s appropriation of some object, Friday’s current level of material wellbeing is Z, and it remains Z after Crusoe’s appropriation. Crusoe’s appropriation would then be justified on grounds of Friday’s current level of well-being. But there are also Friday’s future opportunities

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to achieve a certain level of material well-being to consider. It is only when Crusoe’s appropriation leaves Friday no worse-off in both of these senses, or Crusoe pays compensation, that an appropriation is justified. If, in the state of nature, Friday gathered five bushels of apples a day to eat before Crusoe’s appropriation of a plot of land and Friday’s situation remains the same after the appropriation (Friday still gathers five bushels of apples a day in the same amount of time) and gathering five bushels of apples a day exhausts Friday’s opportunities to improve his situation, then Crusoe has not made Friday worse-off and the proviso is satisfied. This would amount to a “no loss” requirement in terms of Friday’s level of well-being. At a specific time each individual has a certain set of things she can freely use and other things she owns, but she also has certain opportunities to use and appropriate things. This complex set of opportunities along with what she can now freely use or has rights over constitutes her position materially—this set constitutes her level of well-being. We can think of an individual’s level of material wellbeing as her standard of living with opportunity costs. An example may be helpful. Imagine Crusoe stranded on a desert island where there is no chance of rescue and no other material except the sand on the island. Crusoe has a very low level of material well-being. His opportunities are extremely limited and there is little available for him to use or appropriate. If someone were to acquire a grain of sand from the island would Crusoe be worsened? The answer is negative given that Crusoe would have the same level of material well-being after the acquisition of the grain of sand as he did before the acquisition (including opportunities). Now, if someone tried to acquire all of the sand on the island Crusoe would be worsened. The one material item (loosely speaking) he has that offers him any advantage is the island itself. Clearly, to take this material away from him worsens his situation. We find a more complex example of an individual’s level of wellbeing with Fred the small rock appropriator. Suppose Fred is living in the commons on a large island suitably stocked with resources. The only other person around is Crusoe who lives as Fred does. Neither thinks to appropriate anything; they merely use things and then discard them. Given the abundance of resources, Fred and Crusoe have a certain level of well-being. Fred can use things so long as Crusoe is not using them and vice versa. They also have

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certain opportunities to use things and opportunities to appropriate things. One day Fred appropriates a small rock that is one of many on the island. We may ask, is Crusoe worsened by this taking? Given that he can reach down and pick up a similar rock on practically any part of the island it would appear not. Materially, Crusoe is at same level as he was before the appropriation. Moreover, it could be the case that in terms of his level of well-being, which includes opportunity costs, Crusoe is in a better position. Fred’s appropriation might actually augment Crusoe’s opportunities to acquire wealth or use things as in Gauthier’s example where Eve appropriates a plot of land. Generally, an adequate proviso on original acquisition will incorporate an “all things considered” or general reading for the following reasons. The particular object is not important, so long as there is an ample supply of other things (that are similar or practically indistinguishable from the item acquired—that are substitutable) that can be used or acquired freely. What difference does it make whether or not you can use some particular object in conditions of abundance? Locke claims, and rightly so, that an acquisition “can be of prejudice to no man” when there is enough and as good left over. It does not count as worsening when someone has been deprived of using or acquiring a particular object provided relative abundance —i.e., her level of material well-being might be unchanged. In fact, it would be unreasonable to complain about such supposed worsening. Imagine an individual who claims to have been worsened because you have deprived her of inhaling the air you just inhaled. Furthermore, even in cases of scarcity, an “all things considered” view is warranted. Recall the case where Ginger is made better-off if Fred appropriates some object compared to how she would have been had Fred not appropriated.44 Although Ginger cannot improve her situation materially through the appropriation of the object in question, her “all things considered” position is still better. The claim is that in conditions of abundance or scarcity it is not some particular object that is morally relevant, it is an individual’s overall level of well-being that counts. Opportunity Costs So far, there has been a lot of hand waving about opportunities and the worth of opportunities, but we may ask what are opportunities and what are they worth? Moreover, how would one compen-

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sate another for lost opportunities? Given that an adequate account of bettering and worsening will incorporate opportunity costs, an examination of opportunities and opportunity costs is necessary. Although no precise definition of an opportunity will be provided, the following list of features is what I take to be the root idea of an opportunity: 1.

Opportunities are future directed;

2.

Opportunities are generally probabilistic, which means that most of them are uncertain or contingent;

3.

To say that a person has an opportunity is to say that it is possible for them—e.g., one cannot have an opportunity to fly unaided to the moon;

4.

Many opportunities (perhaps most) are dependent on place, time, and the actions or preferences of others;

5.

Opportunities represent possible improvements in an individual’s situation. Assuming that you love life, it would be odd to say that you have the opportunity to die by suffocation.

So what does it mean to say that Ginger has the opportunity to achieve a certain level of material well-being? Crudely, it is to say that in the future Ginger will be at the right time and place to give her a chance to improve her situation materially. Minimally, for Ginger to have an opportunity to do or obtain something, we require that it be possible for her. Furthermore, an opportunity to do or obtain something is not the same as doing it or obtaining it. To say that Ginger has the opportunity to work in a law firm is not to say that she is working in a law firm, rather it is to say that if she chooses to take that path she might, one day, work in a law firm. It is also to say that she is in the right place at the right time. If there were no law firms now or in the future there would be no opportunities to work in them. If a semi-deterministic world and a “God’s eye view” is assumed (everything is determined except Ginger), the “chance” element of opportunities can be eliminated. This is basically the view of opportunities found in modern economic theory. Assuming Ginger is the only agent with freewill, the pay-offs of each of her opportunities would be known with certainty. Suppose choosing B yields her n material benefit (compared to the situation she finds herself in be-

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fore choosing), while choosing C yields her n+1 material benefit. For Ginger, choosing B has an opportunity cost attached—she loses the n+1 benefit that she would have obtained. Opportunity costs are, for the economist, simply the disadvantages associated with choice among outcomes, where the outcomes are known with certainty. If Ginger chooses B then she loses the opportunity to do C and the benefits C would have given her. If she chooses C then she loses the opportunity to B and the benefits B would have given her.45 This as an odd result because if both B and C yield the same result (suppose the outcome for both is n) and are mutually exclusive, what is lost? The outcomes are the same, so if B is chosen it seems the only thing that is lost is the bare opportunity to do C. But given the exclusivity of B and C, we cannot even claim to have lost a bare opportunity, because we never had the opportunity to do both. Minimally, and less controversially, we might claim that B (assuming our original example where the payoff of C was n+1 and the pay-off of B was n) has an opportunity cost for Ginger of +1. Given the probabilistic nature of most opportunities, distinctions must be made among opportunities, their results, and contingency. Consider, in Table 4.2, an opportunity to push a button, the results of the opportunity, and the (non-epistemic) probabilistic nature of the opportunity and the result. Table 4.2 Opportunities Table Opportunities that are certain

Contingent or uncertain opportunities

Results that are certain

100% chance of pushing a button and a 100% chance of winning $50 as the result

50% chance of pushing a button and a 100% chance of winning $50 as the result

Results that are uncertain or contingent

100% chance of pushing a button and 50% chance of winning $50 as the result

50% chance of pushing a button and a 50% chance of winning $50 as the result

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This relatively simple table becomes more complex when we consider multiple contingent opportunities with multiple contingent results. Imagine the case where my opportunity of getting a job is contingent upon my learning about it and my continued existence, while my chance of actually getting the job is dependent on the number of applicants who are more qualified than I am, the employer offering the job to me, and my acceptance of the job. It is trivial to say that there are some opportunities that are contingent or uncertain—some opportunities have probabilities attached. Right now I have the opportunity to get a job at General Motors (assuming that they are hiring) but, given the economy and my skills, it is highly unlikely. Furthermore, it seems problematic to claim there are opportunities that are certain (independent of results). My opportunity to do or obtain anything is dependent on my existence and thus is contingent and uncertain.46 For now, the possibility that some opportunities are certain and promise results that are certain will be left open. In addressing opportunity costs it could be argued that the worth of an opportunity is a function of the probability and the value of the pay-off. The worth of an opportunity is a probabilistically weighted value of the various outcomes—this will include the probability that the action in question will produce the outcome, but also the probability that the action in question is available. If it is certain that the outcome of opportunity B is n, then the value or worth of opportunity B is the value of n (assuming that the opportunity is certain). If there is a .5 chance that a non-contingent opportunity B will yield n, then the value of B is half of the value of n. As a fall-back position we can claim that it is plausible to discount potential benefits if the opportunity or result in question is contingent. It may be sufficient to show that opportunities that have probabilities attached, to either the result or the opportunity itself, are worth less than non-contingent opportunities with results that are certain. There is a monotonic relationship between the probability of an opportunity (and its results) and the value of the opportunity. This is to say as the probability goes up so does the value and vice versa. In a world of uncertain opportunities (and uncertain results), opportunities are not worth their results, they are worth something less. Compensation for lost opportunities may cost less than it would otherwise appear.47 The upshot of this discussion is that opportunities can be understood as chances to do or obtain something beneficial and may be

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worth less than the results they promise. If so, compensation for lost opportunities may be easier than expected. Although the root idea of an opportunity has been examined and some (minimal) information about their worth has been provided, the question of how one would compensate another for lost opportunities must still be considered. Compensation for an individual’s lost opportunities could take many forms, ranging from the augmentation of their remaining opportunities, to the creation of new opportunities, to providing other benefits. Moreover, compensation can take place at both the act level and the system level. Fred himself may compensate Ginger by augmenting her opportunities or the system of property relations that they both engage in may provide compensation. This latter form of compensation will be taken up in chapter 6 while the former will occupy us presently. Consider again the exploited worker case, in which Ginger’s opportunities to achieve a certain level of material well-being have been eliminated by Fred’s appropriation of the entire island that they both inhabit. It is claimed that Ginger has been worsened but suppose that, instead of offering Ginger a wage that equals her independent income in the commons, Fred offers her a higher wage that accounts for her future material success (this might include allowing her to buy part of the island, etc.). Although Fred has eliminated many of Ginger’s opportunities, he has created new opportunities for her or supplied her with other benefits. In such a case, it seems that Ginger is not worsened in any morally relevant sense and Fred’s appropriation is thus justified.48 Suffice it to say that act level compensation can and does occur.49 But further clarification of this kind of compensation requires consideration of the final major problem surrounding the implementation of a proviso—the baseline problem. The Baseline Problem The starting point, which sets the context of the baseline, is the state of nature which is characterized as that initial state where no injustice has occurred. Moreover, in the state of nature the moral landscape has yet to be changed by formal property relations. Indeed, it would be odd to assume that individuals come into the world with complex property relations already intact with the universe— that individuals or groups have some “built in” Honoréan50 rights

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to the universe or parts of the universe. Prima facie, the assumption that the world is devoid of such property relations seems much more plausible.51 The moral landscape is barren of such relations until some process occurs. It is not assumed that the process for changing the moral landscape the Lockean would advocate is the only justified means to this end.52 We may challenge this view of the baseline. Why is it the case that the only two situations that are to be compared are the acquisitive case and the commons? Why not compare the case where Fred appropriated something (the acquisitive case) to the case where Fred had not appropriated but someone else had? Further still, why not compare the case where Fred has appropriated something to the case where Fred and Ginger had incorporated the object in a system of joint ownership?53 For now, assume a state of nature situation where no injustice has occurred (no violations of body rights) and where there are no material relations in terms of use, possession, or rights. Each individual in this state has a specific level of material well-being based on legitimate opportunities to increase her material standing. All anyone has in this initial state are opportunities to increase their material standing because it is assumed that there are no current material relations of any sort. Suppose Fred acquires an object and does not worsen his fellows—alas, all they had were contingent opportunities and Fred’s taking adequately benefits them in other ways. After the acquisition Fred’s level of material well-being has changed. Now, he has a material possession that he holds legitimately, as well as all of his previous opportunities.54 Along comes Ginger who acquires some other object and considers if her exclusion of it will worsen Fred. But what two situations should Ginger compare? Should the acquisitive case (Ginger’s acquisition) be compared to Fred’s initial state (where he had not yet legitimately acquired anything) or to Fred’s situation immediately before Ginger’s taking? It seems clear that because an individual’s level of material well-being changes the baseline must also change. If bettering and worsening are to be cashed out in terms of an individual’s level of material well-being and this measure changes over time, then the baseline of comparison must also change. In the current case we compare Fred’s level of material well-being when Ginger possesses and excludes some object to Fred’s level of material well-being immediately before Ginger’s acquisition.

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Some have argued that individuals who cannot acquire objects from an unowned state have been worsened. No one today has the opportunity to acquire an acre of unowned land in Ohio and it might be claimed that they are worse-off than they would have been because of this fact.55 This view is mistaken. The acquisition of land took place in a certain context of material well-being and opportunities. The baseline is how the individual is now, compared to how they would have been had they acquired land from an unowned state (or had the opportunity to acquire land from an unowned state). There can be no doubt that an individual’s level of well-being is higher now than it would have been had they been able to acquire unowned land at the time of original acquisition. This view is summed nicely by David Schmidtz: Philosophers who write on the subject of original appropriation tend to speak as if people who arrive first, and thus do all the appropriating, are much luckier than those who came later. The truth is, first appropriators begin the process of resource creation while latecomers like ourselves get most of the benefits. Consider the Jamestown colony of 1607. Exactly what was it, we should ask, that made their situation so much better than ours? Of course, they never had to worry about being overcharged for car repairs. They were never awakened in the middle of the night by noisy refrigerators, or leaky faucets, or flushing toilets. They never had to agonize over the choice of longdistance telephone companies. Are those the things that make us wish we had gotten there first?56

All things considered, individuals are better-off now even though they can no longer acquire land (and many other goods) from an unowned state. In this, and in many ways, we stand on the shoulders of those who came before. I have claimed that bettering and worsening should (in part?) be cashed out in terms of an individual’s level of well-being, including opportunity costs, and that the baseline of comparison should be how you are now, after my acquisition, compared to how you were immediately before my acquisition. But consider the following counterexample to my account. What if a perverse inventor creates a machine that will save lives but decides to not allow anyone to use the machine. Those individuals who had, before the creation, no chance (opportunity) to survive now have a chance and are worsened because of the perverse inventor’s refusal to let others use the machine. But the baseline this case implies cannot be correct. On this view, to determine bettering and worsening we are to compare how indi-

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viduals are before the creation of some value (in this case the life saving machine) to how they would be if they possessed or consumed that value. But we are all worsened in this respect by any value that is created and held exclusively. I am worsened by your exclusive possession of your car because I would be better-off if I exclusively controlled the car. Any individual, especially those who have faulty hearts, would be better-off if they held title to my heart compared to anyone else’s holding the title. I am also worsened when you create a new philosophical theory and claim authorship—I would have been better-off (suppose it is a valuable theory) if I had authored the theory, so you have worsened me. Clearly this account of the baseline makes the notions of bettering and worsening too broad.57 The result of this lengthy discussion of material well-being, opportunity costs, and the baseline problem is the following proviso on original acquisition:58 SP4: If an acquisition makes no one worse-off in terms of their level of material wellbeing (including opportunity costs) compared to their level of material well-being immediately before the acquisition, then the taking is permitted.

Test Cases One way to test this new proviso (SP4) is to see how it handles the tough cases. Easy cases will be considered initially, and then more difficult cases will be examined. Consider, once again, Fred the small rock appropriator. In appropriating a small rock, he does not make his fellows worse-off in terms of their level of material well-being, given the abundance of small rocks. In this case, where scarcity is not an issue, SP4 yields the proper result. If someone objects Fred can say, and rightly so, “Get your own rock.”59 Another test case is the only-water-hole-in-the-desert example. Imagine Fred trying to appropriate the only water hole in a desert, where many individuals are dependent upon the water for survival. In trying to obtain exclusive rights to the water, Fred makes his fellows worse-off, for without the water, all of their opportunities to acquire wealth along with their ability to maintain their current level of well-being are eliminated. In this case of extreme scarcity water is important material. Notice that we have a case of worsening regardless of the preferences of Fred’s fellows. They may all actually prefer that Fred own the water and charge starvation prices for it. SP4

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gives us the desired result in this case. The appropriation would be illegitimate unless compensation is paid. It is also the case that SP4 would correctly adjudicate the exploited worker case where Fred appropriates everything and offers Ginger a wage that benefits her only slightly above what she could earn by herself in the commons.60 Part of Ginger’s well-being in the commons is her opportunities to achieve a higher level of material wellbeing at some later time. In appropriating the island, Fred effectively eliminates these opportunities and thus drives Ginger below what we have found to be a morally relevant base point. Fred’s appropriations may still be legitimate, but only if he compensates Ginger for her lost opportunities to achieve a certain standard of living. To take a famous example, consider the Robinson Crusoe case. Crusoe has a certain level of well-being and, supposing that he will never be rescued, his opportunities for material improvement are slim. Given there are no others around Crusoe appropriates the only fruit tree on the island. The reason he gives to justify his appropriation is that no one else has been worsened. Now suppose Friday washes ashore dying of scurvy and tries to eat from the fruit tree. Can Crusoe exclude Friday from this scarce resource? Part of Friday’s opportunities to achieve any level of material well-being depend on his being able to freely use the fruit from the tree. That Crusoe did not know this does not matter.61 But now things get tricky. What if Crusoe had saved the tree from dying and spent years laboring to nurture it back to health? In this case it seems that a labor or desert principle runs headlong into SP4. Suppose that if Crusoe did not acquire and exclude the tree it would have died and Friday would have had no opportunities to use or acquire parts of the tree. In this case we look at Friday’s level of material well-being the moment before Crusoe’s acquisition which includes a dim future. The moment before Crusoe’s acquisition Friday has no opportunities to use or acquire the tree because the tree’s existence depends on Crusoe’s acquisition. In this case SP4 would allow the appropriation of the tree by Crusoe. Conclusion I would like to conclude the chapter by summarizing a few important results. In conditions of abundance, the use of SP4 justifies individual acts of appropriation. This applies to relatively non-con-

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troversial cases like the appropriation of a grain of sand or Fred the small rock appropriator. Furthermore, in more controversial cases like Gauthier’s Eve example, it is possible that land, as well as other relatively scarce goods, can be appropriated. In general, the theory represents Locke’s intuition that so long as there is “enough and as good” an appropriation is of prejudice to no one and is therefore justified. This is a non-trivial result that, in part, solves Locke’s original question—we have found a way for individuals to unilaterally generate rights to previously unowned objects.62 Notes 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

11. 12. 13. 14. 15.

16.

John Locke, The Second Treatise of Government, ed. T. Peardon (New York, Liberal Arts Press, 1952, Bobbs-Merrill Publishing, 1952), § 27. Becker, Property Rights: Philosophic Foundations (London: Routledge & Kegan Paul 1977), 32. There are several distinct strands to the Lockean argument. See Becker, Property Rights, 32-56. A. John Simmons voices these problems in The Lockean Theory of Rights (Princeton, NJ: Princeton University Press, 1992), 267-69. Jeremy Waldron, “Two Worries about Mixing One’s Labor,” Philosophical Quarterly (January 1983): 37, 40. David Hume, Treatise of Human Nature, 3.2.3.: “we cannot be said to join our labor to any thing except in a figurative sense.” Robert Nozick, Anarchy, State, and Utopia (New York: Basic Books, 1974), 175. P. J. Proudhon, What is Property?, originally published in 1867, (New York: Howard Fertig, 1966), 61, and John Plamenatz, Man and Society (London: Longmans, Green, 1963), 1:247. Geraint Perry, John Locke (London: Allen & Unwin, 1978), 52, and Waldron, “Two Worries,” 42. Nozick, Anarchy, 174, Thomas Maurtner, “Locke on Original Appropriation,” American Philosophical Quarterly (July 1982): 261. John Rawls, A Theory of Justice (Cambridge, MA: Harvard University Press, 1971), 104. Edwin Hettinger, “Justifying Intellectual Property,” in Intellectual Property: Moral, Legal, and International Dilemmas, edited by A. Moore (Lanham, MD.: Rowman & Littlefield, 1997), chapter 2, 22, 26. Ruth Grant, John Locke’s Liberalism (Chicago: University of Chicago Press, 1987), 112. I will return to this issue in chapter 7. For example, Simmons in The Lockean Theory of Rights provides a complex analysis of Lockean property theory and attempts to answer many of these problems. Nozick, Anarchy, 174-82. John Locke, The Second Treatise of Government, II-27 (italics mine) Nozick, Anarchy, 176 Nozick, Anarchy, 176. Nozick actually combines both ways to be worse-off (see NP2) into a stringent version of the proviso that he rejects as being too strong. One reason he gives for rejecting the stringent proviso is that the first way to be worseoff leads to the reverse domino problem. Wendy Gordon presents a variation on this account of harm. “. . . the proviso treats only one kind of harm as relevant for property formation purposes: it protects the

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17. 18. 19. 20.

21.

22. 23. 24. 25.

26. 27. 28. 29. 30. 31.

32.

Intellectual Property and Information Control propertyless from the depletion of the common.” Gordon, “A Property Right in Self-Expression: Equality and Individualism in the Natural Law of Intellectual Property,” Yale Law Journal 102 (1993): 1564. Surely this account of harm is overly simplistic. What if I deplete the commons yet open up other substantially valuable opportunities for you? Does lessening the commons by taking a grain of sand from an endless beach worsen or harm? What does depleting the commons mean in relation to physical goods or intellectual works? Nozick, Anarchy, 176. Nozick, Anarchy, 176. I should also note that even if these problems can be answered, satisfying NP2 would not, by itself, justify acquisition. NP2 is a necessary condition that must be joined with other requirements before an acquisition is justified. Another case similar to the exploited worker case is where Ginger, because she is temporarily sick, has limited capacities to use things. Fred appropriates everything and compensates Ginger for her ‘sickly capacities’ to use rather than her healthy capacities to use. There is a difference between mere possession and rights to exclude, use, and augment. One obvious difference is that when one has property rights one can exclude others from possessing or using an object even when the object is not in one’s actual possession. David Gauthier, Morals By Agreement (Oxford: Oxford University Press, 1986), 279. It is important to note that, for Gauthier, the proviso does not have independent moral weight outside of his contractarian argument. For our purposes, we will treat Gauthier’s proviso as if it has independent moral weight. See Don Hubin and Mark Lambeth, “Providing For Rights” in Dialogue (1986), for a more detailed discussion of the issues presented in this section. Gauthier, Morals By Agreement, 203. Crudely, subjective preference satisfaction theories hold that satisfying individual preferences or desires is intrinsically valuable. Jeremy Waldron also seems to endorse a subjective account of worsening citing the feelings of “distress” and “bitterness” as possible ways to be harmed. See Jeremy Waldron, “From Authors to Copiers: Individual Rights and Social Values in Intellectual Property” Chicago-Kent Law Review 68 (1993): 867. Gauthier, Morals By Agreement, 209. Gauthier, Morals By Agreement, 215. Gauthier, Morals By Agreement, 215. Gauthier, Morals By Agreement, 216 (italics mine). Gauthier’s justification of property rights is actually a two-stage process. If Eve does not violate the proviso, then she obtains possession rights to an object. If taking Eve’s object violates the proviso, then Eve has property rights to it. One could object to this case on the grounds that it depends on individuals taking an interest in one another’s interests—this is to say that they have “tuistic” desires. Gauthier assumes that the proviso is intended to apply to interaction under the assumptions of individual utility maximization and mutual unconcern or disinterestedness. For problems with Gauthier’s non-tuism assumption, see Don Hubin, “NonTuism,” in Canadian Journal of Philosophy 21 (December 1991): 441-68. In part, these cases attempt to show the implausibility of maintaining the claim that the sole standard of intrinsic value—in fact, that which creates intrinsic value—is the satisfaction of desires and preferences. “It might be enough (to eliminate the theory as a plausible contender) to ask whether anyone finds it even possible to

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33.

34. 35. 36. 37.

38.

39. 40.

41.

42. 43. 44. 45.

46.

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think that goodness could be brought into being by the feeling of some one or other, no matter how vicious or stupid or ignorant he might be.” D. Ross, “The Nature of Goodness” in Readings in Ethical Theory, edited by Sellers and Hospers (New York : Appleton —Century—Crofts, Inc. 1952) (italics mine). The objection usually voiced at this point is that the worry depends on an “odd” preference. If we rule out such preferences there is no problem. While this is a plausible strategy I have yet to come across any generally accepted procedure or rule that tells us which preferences count. Although P3 has not been closely examined it will have many of the same problems as P3'. Moreover, SP2 and P3' allow, as morally relevant worsenings, things that are not. Wendy Gordon, “A Property Right in Self-Expression: Equality and Individualism in the Natural Law of Intellectual Property,” Yale Law Journal 102 (1993): 1545. The moral principles and claims that follow are part of a larger theory of value and deeper moral commitments. The view is Lockean in spirit and should be taken as an assumption in the argument that attempts to justify a system of private property relations based on a Pareto requirement. The explication and defense of a full-blown Lockean moral theory is left for another time. For similar views, see Rawls, A Theory of Justice, chapter VII; Aristotle, Nicomachean Ethics, bks. I and X; Kant, The Fundamental Principles of The Metaphysics of Morals; Sidgwick, Methods of Ethics; R. B. Perry, General Theory of Value; Loren Lomasky, Persons, Rights, and the Moral Community (Oxford: Oxford University Press, 1987). See Mill’s notorious proof in Utilitarianism, chapter IV. For a defense of a view similar to the one I offer, see Warren Quin’s Morality and Actions, especially chapter 11, “Rationality and the Human Good.” See also, David Schmidtz, Rational Choice and Moral Agency (Princeton, NJ: Princeton University Press, 1995). A life of both intellectual and physical activity is necessary for human flourishing. Minimally the claim is that the individual who does not develop her intellectual capacities or engage in an active intellectual life cannot be said to flourish. Similarly, the individual who does not develop her physical capacities or engage in a robust life of physical activity (including material relations) cannot be said to flourish. Life projects that do not accommodate these general facts are irrational. Once again, a complete picture of what counts as a rational lifelong project will depend on the underlying moral theory and a refined theory of human nature. Lysander Spooner, The Law of Intellectual Property (Weston, MA: M & S Press, 1971), 10, 36 (Originally published in 1855). Gordon appears to fall prey to this worry. See Wendy Gordon in “A Property Right in Self-Expression: Equality and Individualism in the Natural Law of Intellectual Property,” Yale Law Journal 102 (1993): 1564, 1574. Temporarily setting the baseline as Ginger’s appropriation of some object compared to Fred’s appropriation of it. See Heinz Kohler, Scarcity And Freedom (Lexington, MA: Heath and Company, 1977), or H. G. Heymann and Robert Bloom, Opportunity Cost In Finance And Accounting (New York: Quorum Books, 1990). For a more philosophical discussion closer to the views presented in this section, see Michael Levin, “Equality of Opportunity” in The Philosophical Quarterly (1981). Certainly we can cook up science fiction cases where taking some special pill guarantees both our existence and determines that a certain action will be performed.

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47.

48. 49.

50. 51. 52. 53.

54. 55. 56. 57. 58.

Intellectual Property and Information Control But assuming that we are essentially contingent beings that have freewill, opportunities that are certain will be rare indeed. The assumption is that, “if it were the case that A then it might be that B.” There are both epistemic and metaphysical issues attached to this “might conditional.” A metaphysical assumption is that there are determinant probabilities that attach to the consequent. An epistemic consideration is how would we determine what the probabilities in question. When determining, epistemically, what some probability would be, it is proposed that we proceed as we normally do when assigning probabilities. Historical facts, previous analogous situations, physical laws, and the like, should be used in assigning the probability of the consequent of a “might conditional.” For now, I will side-step issues like the loss of independence or self-government that may be caused by working for others. Once again, consider the case where Ginger is better-off, all things considered, if Fred appropriates everything compared to how she would have been had she appropriated everything (maybe Fred is a great manager of resources). Although Ginger has been worsened in some respects she has been compensated for her losses in other respects. Honoréan rights are: the right to manage, the right to transfer, the right to capital, absence of term, prohibition of harmful use, the right to possess, etc. See the relevant section of chapter 2. One plausible exception is body rights which are similar to, if not the same as, many of the rights that surround property. There may be many others such as consent theories, consequentialist theories, social contract theories, theories of convention, and so on. Wendy Gordon in “A Property Right in Self-Expression: Equality and Individualism in the Natural Law of Intellectual Property,” Yale Law Journal 102 (1993): 1533-1609, seems to present a shifting baseline and account of harm. For example she writes, “A person who wants access is entitled to complain only if he is worse-off (in regard to the common) when he is denied access than he would have been if the item had never come into existence” (1563). Here it seems, to determine harm, we imagine a fellow in the commons and compare denied access to some object with the non-existence of it. Later we get, “having changed people’s position, the inventor cannot then refuse them the tools they need for surviving under their new conditions” (1568). Now it seems we are to consider how someone is when they get to use some object or value compared to how they would be if they didn’t get to use the object or value. Either one of these baselines and the account of harm adopted is awash with many of the problems that befall Nozick and Gauthier. Minus the opportunity to acquire the object he just acquired. But then again, his acquisition and exclusion of some object may create other opportunities as well. It should be clear that this is a problem with the baseline. Those who give this argument want to compare how they would be now, if they could acquire land from an unowned state, to how they actually are. David Schmidtz, “The Institution of Property,” Social Philosophy and Policy 11 (1994): 45. For a similar, yet still mistaken, view of the baseline see Jeremy Waldron, “From Authors to Copiers: Individual Rights and Social Values in Intellectual Property,” Chicago-Kent Law Review 68 (1993): 866. P4 permits the use, exclusion, and augmentation of an object. Although this does not give us a complete theory of property relations, it begins the process. It will be

A Pareto-Based Proviso on Original Acquisition

59. 60. 61.

62.

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argued that P4, whatever other forms of property relations it might allow, permits private property relations. This parallels the case of the person who claims she is worsened when you inhale because she has lost the opportunity to improve her situation by inhaling the very air you did. Notice that this is a fairly odd case where the results are certain and the opportunity is certain. It is more likely that had Fred not acquired everything Ginger would have only had a chance at future material success. For simplicity, I will imagine perfect knowledge or a “God’s eye” view in these cases. In the real world with actual persons who have limited knowledge, we rely on micro and macro compensation or a principle of rectification. For a brief discussion of what a principle of rectification would look like, see Nozick, Anarchy, 151-53. Moreover, even in conditions of extreme scarcity restricted access to scarce goods might be required. If tragedy of the commons considerations are taken seriously, someone or some group must restrict access or else the resource will be destroyed. In this case, the only way to leave “enough and as good” is to exclude others from the scarce resource. See David Schmidtz, “When is Original Acquisition Required,” in The Monist 73 (October 1990): 504-18.

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5 Toward a Lockean Theory of Intellectual Property “Nor was this appropriation of any parcel of land by improving it any prejudice to any other man, since there was still enough and as good left, and more than the yet unprovided could use. So that, in effect, there was never the less left for others because of his enclosure for himself; for he that leaves as much as another can make use of does as good as take nothing at all.” —John Locke, The Second Treatise of Government1

Introduction Most of us would recoil at the thought of shoplifting a ballpoint pen from the campus bookstore and yet many do not hesitate to copy software worth thousands of research dollars without paying for it.2 When challenged, replies like “I wouldn’t have purchased the software anyway” or “they still have their copy” are given to try to quell the sinking feeling that something ethically wrong has occurred. Moreover, with the arrival of the information age, where digital formats make copying simple and virtually costless, this asymmetry in attitudes is troubling to those who would defend AngloAmerican institutions of property protection. One way of understanding these replies is that they suggest a real difference between intellectual property and physical or tangible property.3 My use of your intellectual property does not interfere with your use of it, whereas this is not the case for most tangible goods. Justifying intellectual property in light of this feature raises deep questions and has led many to abandon the romantic image of “Lockean labor mixing” in favor of incentives-based, rule-utilitarian justifications. Labor-mixing theories of acquisition may work well when the objects of property can be used and consumed by only one person at a time, but they seem to lose force when the 103

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objects of property can be used and consumed by many individuals concurrently. In the following chapter a Lockean theory of intellectual property rights will be explained and defended. Building on the results of chapter 4, I will argue that individual acts of intellectual property appropriation can be justified in reference to Locke’s proviso. If successful, the theory will support the intuition that something ethically wrong has occurred when computer software, music, or other intellectual works are pirated. A Lockean Theory of Intellectual Property As noted in chapter 3, Anglo-American systems of intellectual property are justified on rule-utilitarian grounds. Rights are granted to authors and inventors of intellectual property “to promote the progress of science and the useful arts.”4 Society seeks to maximize utility in the form of scientific and cultural progress by granting limited rights to authors and inventors as an incentive toward such progress. In general, patents, copyrights, and trade secrets are devices created by statute to prevent the diffusion and use of ideas before the author or inventor has recovered profit adequate to induce investment and creation of these ideas. Many Lockeans, including myself, would like to provide a more solid foundation for intellectual property. Defenders of robust rights to property, be it tangible or intangible property, argue that something has gone awry with rule-utilitarian justifications. Rights, they claim, stand athwart considerations of utility-maximization or promoting the social good. As noted at the end of chapter 3, there is a kind of global inconsistency to utilitarian justifications of rights within the Anglo-American tradition. Why should my rights to physical property be somehow less subject to concerns of social utility than my rights to intellectual property? Within the Anglo-American tradition, “rights”—to physical property, life, the pursuit of happiness— are typically deontic in nature. Thus in generating rights to intellectual property on utilitarian grounds we are left with something decidedly less than what we typically mean when we say someone has a right.5 In fact, it may be argued that what has been justified is not a right but something less, something dependent solely on considerations of the overall social good. Alas, if conditions change it may be the case that granting control to authors and inventors over what

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they produce diminishes overall social utility, and thus on utilitarian grounds society should eliminate systems of intellectual property. Furthermore, over the past three decades rule-utilitarian moral theory, as well as utilitarian-based justifications for systems of intellectual property, have come under a sustained and seemingly decisive attack.6 Suffice it to say that even if incentive-based, rule-utilitarian justifications remain viable, their mere viability does not exclude alternative justifications of intellectual property rights. Before proceeding toward a Lockean theory of intellectual property, I would like to discuss two important differences between intellectual property and physical property. As noted in the opening, intellectual property is non-rivalrous in the sense that it can be possessed and used by many individuals concurrently. Unlike my car or computer, which can only be used by one person at a time, my recipe for spicy Chinese noodles can be used by many individuals simultaneously. It may be objected that some intellectual works are rivalrous, for example the Mona Lisa or Michelangelo’s David. What is rivalrous about these works is not the ideas that are embodied in the canvas or stone—it is the physical works themselves. We can all hang a copy of the Mona Lisa in our living rooms—we just can’t have the original embodiment. Consider the following rivalry of goods table. One way to clarify the non-rivalrous nature of intellectual property is by comparing it with the ownership of physical or tangible property. Physical property rights restrict what can be done with one’s Table 5.1 Rivalry of Goods7

Created

Rival

Non-Rival

Ordinary Goods:

Copyable Goods: Sets of ideas: Novels, Processes of Manufacture, Computer Programs, etc.

Cars, Computers, Guitars, etc.

Natural Resources: Discovered

Coal, Fish, Air, Water, Crude oil, Land, etc.

Laws of Nature, Mathematical Truths, etc.

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property. For example, you cannot justifiably run your car through my house. Tangible property rights also limit intellectual property rights in that you cannot justifiably instantiate your intellectual property, without my consent, in my physical property—you can’t build your new static electricity motor out of my nuts and bolts. As with tangible property rights, intellectual property rights restrict what individuals can do with their physical property. You cannot copy my intellectual property and instantiate it in your physical property. The way in which intellectual property is different than tangible property is that rights to intellectual property do not limit other intellectual property rights. My rights to control the set of ideas that comprise my new recipe for spicy Chinese noodles does not limit your rights to control your version of the same recipe. Assuming that we both have legitimate title, our rights are non-rivalrous in this respect. Another difference between physical and intangible property concerns what is available for acquisition. While matter, owned or unowned, already exists, the same is not true of all intangible works. What is available for acquisition in terms of intangible property can be split into three domains. There is the domain of ideas yet to be discovered (new scientific laws, etc.), the domain of ideas yet to be created (the next Lord of the Rings, Star Wars, etc.), and the domain of intangible works that are privately owned. Since it is possible for individuals to independently invent or create the same intangible work and obtain rights, we must include currently owned intangible works as available for acquisition.8 Only the set of ideas that are in the public domain or those ideas that are a part of the common culture are not available for acquisition and exclusion. I take this latter set to be akin to a public park.9 Original Acquisition Following the themes started in chapter 4, we may begin by asking how property rights to unowned objects are generated. This is known as the problem of original acquisition and a common response is given by John Locke. “For this labor being the unquestionable property of the laborer, no man but he can have a right to what that is once joined to, at least where there is enough and as good left for others.”10 Moreover, Locke claims that so long as the proviso that enough and as good is left for others is satisfied, an acquisition is of “prejudice to no man.”11 The proviso is generally

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interpreted as a necessary condition for legitimate acquisition, but I would like to examine it as a sufficient condition.12 If the appropriation of an unowned object leaves enough and as good for others, then the acquisition and exclusion is justified. Before continuing, I would like to note that theories of collective ownership also face the problem of original acquisition. Opponents of private property generally champion this problem and claim that it provides a decisive case against individual accumulation of goods. It is rarely recognized that the problem of original acquisition is also a problem for collective ownership as well. Why should the group that arrives first be able to create duties of non-interference against all other groups simply because they arrived first? Certainly, arriving first is morally arbitrary. Why should the first comers, as a group, enjoy the privileged status of controlling the resources in a given geographic location? How can one group, all by itself, unilaterally change the moral landscape and create moral obligations binding countless other groups? Some have tried to answer this problem by noting that collective ownership means ‘owned by everyone on earth’—not group ownership. But now we have a new group and a new arbitrary line. Why should Martians be excluded, or future generations, or evolved dolphins? Moreover, why does claiming that X is collectively owned, in whatever sense, count as justification for collective control—there is no argument here, just an assertion.13 To continue, suppose that mixing one’s labor with an unowned object creates a prima facie claim against others not to interfere that can only be overridden by a comparable claim. The role of the proviso is to stipulate one possible set of conditions where the prima facie claim remains undefeated. This view is summed up nicely by Clark Wolf: On the most plausible interpretation of Locke’s theory, labor is neither necessary nor sufficient for legitimate appropriation. Mixing labor with an object merely supports a presumptive claim to appropriate. The proviso functions to stipulate conditions in which this presumptive claim will be undefeated, or overriding, and will therefore impose duties of noninterference on others.14

Whether or not Wolf has interpreted Locke correctly, this view has strong intuitive appeal. Individuals in a pre-property state are at liberty to use and possess objects. Outside of life or death cases it is plausible to maintain that laboring on an object creates a weak presumptive possession and use claim against others. Minimal respect

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for individual sovereignty and autonomy would seem to support this claim. The proviso merely indicates the conditions under which presumptive claims created by labor, and perhaps possession, are not overridden by the competing claims of others. Another way of stating this position is that the proviso in addition to X, where X is labor or first occupancy or some other weak claim generating activity, provides a sufficient condition for original appropriation. Justification for the view that labor or possession may generate prima facie claims against others could proceed along several lines. First, labor, intellectual effort, and creation are generally voluntary activities that can be unpleasant, exhilarating, and everything inbetween. That we voluntarily do these things as sovereign moral agents may be enough to warrant non-interference claims against others. 15 A second, and possibly related justification, is based on desert. Sometimes individuals who voluntarily do or fail to do certain things deserve some outcome or other. Thus, students may deserve high honor grades and criminals may deserve punishment. When notions of desert are evoked claims and obligations are made against others—these non-absolute claims and obligations are generated by what individuals do or fail to do. Thus in fairly uncontroversial cases of desert, we are willing to acknowledge that weak claims are generated and if desert can properly attach to labor or creation, then claims may be generated in these cases as well. Finally, a justification for the view that labor or possession may generate prima facie claims against others could be grounded in respect for individual autonomy and sovereignty. As sovereign and autonomous agents, especially within the liberal tradition, we are afforded the moral and legal space to order our lives as we see fit. As long as respect for others is maintained we are each free to set the course and direction of our own lives, to choose between various lifelong goals and projects, and to develop our capacities and talents accordingly. Simple respect for individuals would prohibit wresting from their hands an unowned object that they acquired or produced. I hasten to add that at this point we are trying to justify weak noninterference claims, not full-blown property rights. Other things being equal, when an individual labors to create an intangible work, then weak presumptive claims of non-interference have been generated on grounds of labor, desert, or autonomy.

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As noted before, the role of the proviso is to stipulate one possible set of conditions where a prima facie claim to control remains undefeated. Suppose Fred appropriates a grain of sand from an endless beach and paints a lovely, albeit small, picture on the surface. Ginger, who has excellent eyesight, likes Fred’s grain of sand and snatches it away from him. On this interpretation of Locke’s theory, Ginger has violated Fred’s weak presumptive claim to the grain of sand. We may ask, what legitimate reason could Ginger have for taking Fred’s grain of sand rather than picking up her own grain of sand? If Ginger has no comparable claim, then Fred’s prima facie claim remains undefeated. An undefeated prima facie claim can be understood as a right.16 A Pareto-Based Proviso The underlying rationale of Locke’s proviso is that if no one’s situation is worsened, then no one can complain about another individual appropriating part of the commons. Put another way, an objection to appropriation, which is a unilateral changing of the moral landscape, would focus on the impact of the appropriation on others. But if this unilateral changing of the moral landscape makes no one worse-off, there is no room for rational criticism. The proviso permits individuals to better themselves so long as no one is worsened (weak Pareto-superiority). The base level intuition of a Pareto improvement is what lies behind the notion of the proviso: One state of the world, S1, is Pareto-superior to another, S2, if and only if no one is worse-off in S1 than in S2, and at least one person is better-off in S1 than in S2. S1 is strongly Pareto-superior to S2 if everyone is better-off in S1 than in S2, and weakly Pareto-superior if at least one person is better-off and no one is worse-off. State S1 is Pareto optimal if no state is Pareto superior to S1: it is strongly Pareto optimal if no state is weakly Pareto superior to it, and weakly Pareto optimal if no state is strongly Pareto superior to it.17

If no one is harmed by an acquisition and one person is bettered, then the acquisition ought to be permitted. In fact, it is precisely because no one is harmed that it seems unreasonable to object to a Pareto-superior move. Thus, the proviso can be understood as a version of a “no harm, no foul” principle. It is important to note that compensation is typically built into the proviso and the overall account of bettering and worsening. 18 Gauthier echoes this point in the following case:

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In acquiring a plot of land, even the best land on the island, Eve may initiate the possibility of more diversified activities in the community as a whole, and more specialized activities for particular individuals with ever-increasing benefits to all.19

Eve’s appropriation may actually benefit her fellows and the benefit may serve to cancel the worsening that occurs from restricted use. Moreover, compensation can occur at both the level of the act and at the level of the practice. This is to say that Eve herself may compensate or that the system in which specific property relations are determined may compensate. This leads to a related point. Some have argued that there are serious doubts whether a Pareto-based proviso on acquisition can ever be satisfied in a world of scarcity. Given that resources are finite and that acquisitions will almost always exclude, your gain is my loss (or someone’s loss). On this model, property relations are a zero-sum game. 20 If this were an accurate description, then no Pareto-superior moves can be made and no acquisition justified on Paretian grounds. But this model is mistaken. An acquisition by another may worsen your position in some respects but it may also better your position in other respects. Minimally, if the bettering and worsening cancel each other out, a Pareto-superior move may be made and an acquisition justified. Locke recognizes this possibility when he writes: To which let me add, that he who appropriates land to himself by his labour, does not lessen, but increase the common stock of mankind; for the provisions serving to the support of human life, produced by one acre of enclosed and cultivated land, are ten times more than those which are yielded by an acre of land of equal richness lying waste in common.21

Furthermore, it is even more of a stretch to model intellectual property as zero-sum. Given that intellectual works are non-rivalrous—i.e., they can be used by many individuals concurrently and cannot be destroyed—my possession and use of an intellectual work does not exclude your possession and use of it. This is just to say that the original acquisition of intellectual or physical property does not necessitate a loss for others. In fact, if Locke is correct, such acquisitions benefit everyone. Before continuing, I will briefly consider the plausibility of a Pareto-based proviso as a moral principle. First, to adopt a less-thanweak Pareto principle would permit individuals, in bettering themselves, to worsen others. Such provisos on acquisition are troubling

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because at worst they may open the door to predatory activity and at best they give anti-property theorists the ammunit